On Aug. 30, 2016, assistant professor Han Han`s research paper Equilibrium Using Credit or Money with Indivisible Goods was published online by Journal of Economic Theory, a top journal of economic theory. Based on the theoretical framework of the new monetarist economics, the paper studies the trade and pricing of indivisible goods in a frictional market. This study lays a theoretical foundation for the follow-up study of indivisible goods, which fills in the gap of indivisible goods’ trading in the frictional monetary conditional, and has important theoretical significance for indivisible goods’ market research.

The commodity divisibility hypothesis is made by the economists to simplify the analysis, but in reality, there are many indivisible commodities and assets, such as real estate, which are theoretically limited by commodity divisibility hypothesis. Therefore, the indivisible goods’ trade in the frictional market is concerned by the economic and financial circles. Academics pay more attention to indivisible goods in transaction, pricing and market frozen under different means of payment. However, in frictional monetary conditions, indivisible goods trading is a weak link in research.

Han Han`s research skillfully fills in this link. Han and his collaborators, based on the characteristics of indivisible goods, adopted the new monetarist framework innovatively to study the transactions of indivisible goods in the friction market under steady state. The paper elaborates the determinants of transaction conditions, transaction prices and market transaction speed of indivisible goods and highlights the heterogeneity of divisible and indivisible goods. The research laid a theoretical foundation for further research on the effects of monetary and credit policies on indivisible goods.

Han Han is the lead author of the paper and collaborated with collaborators from the United States, Australia and the United Kingdom.

Attached: Han Han’s article link

http://www.sciencedirect.com/science/article/pii/S0022053116300606.