My main research interest is in monetary theory. I am especially interested in foundational issues such as the nature, the functions and the essentiality of money, particularly questions like: what is money? Why do we use it in everyday transactions? Could it be replaced by credit-like instrument? Will it survive the digital payment transformation the economy has been undergoing over the last few decades?
I have addressed these issues in a series of theoretical papers on the microfoundations of monetary exchange, with a particular focus on the coexistence of money and credit. The key idea of my research in this area was to highlight the complementarity between money and credit, as the latter can help to better allocate the former. My point of view, somewhat in contrast with the literature, is that credit-like instruments can cooperate rather than compete with money in the allocation of resources. In a series of papers with a more applied stance, I have explored the role of collateralized credit in the onset and propagation of economic fluctuations in monetary economies.
Relating to the digital payment transformation, I have written several papers on the benefits of replacing cash with sovereign digital currency. The idea is that sovereign digital currency is still a monetary instrument like cash, with one distinguishing feature, namely, the traceability of its flows, arising from its digital and centralized nature. Hence, economies may still remain monetary while becoming cash-less as sovereign digital currency replaces traditional currency, with a potential extra boon arising from this new feature. Indeed, in joint work with my coauthors, we have shown that the traceability of sovereign digital currency can be leveraged by the monetary authorities to entice participation in trade by paying interest on currency balances that do not remain idle in the accounts. Thus, the introduction of sovereign digital currency, as envisaged for instance by the ECB for the near future, can help central bankers increase the velocity of circulation of currency with beneficial effects for production and trade. Currently, we are testing our predictions in the lab, where we found preliminary support for our theory.
A general research interest of mine concerns equilibrium refinements and selection procedures among multiple equilibria in economies and games. This interest shows up throught my research, as sunspot equilibria pop up repeatedly in my work in monetary theory, but emerges more distinctly in a few papers I have written over the years with my coauthors on the theory of voting and on games with population uncertainty. In a recent paper, we have shown how to use the expected turnout in a Poisson game version of the stug hunt to select between multiple equilibria, with larger crouds promoting bolder behavior.
PUBLISHED PAPERS
“Foreign Lenders and the Real Sector”, with R. Minetti, Journal of Money, Credit and Banking, 39, 2007, 945-964, PDF: Foreign lenders
“Collateral Secured Loans in a Monetary Economy”, with M. Watanabe, Journal of Economic Theory, 143, 2008, 405-424, PDF: Collateral secured loans
“On the Complementarity of Money and Credit”, European Economic Review, 54, 2010, 733-741, PDF: Complementarity
“Collateral Fluctuations in a Monetary Economy”, with M. Watanabe, Journal of Economic Theory, 146, 2011, 1915-1940, PDF: Collateral fluctuations
“On the Effect of Ideology in Proportional Representation Systems”, with F. De Sinopoli and G. Iannantuoni, Mathematical Social Sciences, 62, 2011, 87-90, PDF: Ideology
“Liquidity Constraints in a Monetary Economy”, with M. Watanabe, International Economic Review, 53, 2012, 255-277, PDF: Liquidity constraint
“Electing a Parliament”, with F. De Sinopoli and G. Iannantuoni, Social Choice and Welfare, 40, 2013, 715-727, PDF: Electing parliament
“Foreign Banks and the Dual Effect of Financial Liberalization”, with R. Minetti, Journal of Money, Credit and Banking, 45, 2013, 1301-1333, PDF: Foreign banks
“Limited Committment and the Legal Restrictions Theory of the Demand for Money”, with F. Mattesini, Journal of Economic Theory, 151, 2014, 196-215, PDF: Legal restriction
“Moderating Government”, with F. De Sinopoli and G. Iannantuoni, Social Choice and Welfare, 45, 2015, 415-440, PDF: Moderating government
“Money and Limited Enforcement in Multilateral Exchange”, with N. Amendola, Macroeconomic Dynamics, November 2018, 1-18, PDF: Money Limited Enforcement
“Collateral and Development”, with N. Amendola and L. Carbonari, B.E. Journal Macroeconomics, Advances, June 2019, PDF: Collateral development
“Liquidity Externalities and the Wallace Conjecture”, with N. Amendola and F. Mattesini, Macroeconomic Dynamics, October 2019, 1-11, PDF: Wallace conjecture
“Money and Collateral”, with F. Mattesini, Journal of Money, Credit and Banking, October 2020, 52, 1617-1644, PDF: Money Collateral
“Money, Bonds and the Liquidity Trap”, with L. Araujo, Journal of Money, Credit and Banking, October 2020, 52, 1853-1867, PDF: Money Bonds Trap
“Money and Credit Remix”, with L. Araujo, Macroeconomic Dynamics, September 2020, 1-14, PDF: Remix
“Societal Benefit of Multiple Currencies”, with L. Araujo, Journal of Money, Credit and Banking, May 2021, PDF: Multiple currencies
“Three Liquid Assets” with N. Amendola and L. Carbonari, Macroeconomic Dynamics, April 2024, 28, PDF: Three liquid assets
“Poisson Search”, with C. Meroni and F. De Sinopoli, Journal of Mathematical Economics, June 2024, 112, PDF: Poisson search
“Group Size as Selection Device”, with C. Meroni and F. De Sinopoli, Economic Theory, May 2026, PDF: Group size
“Optimal Payment Arrangement in a Cash-less Monetary Economy”, with N. Amendola and L. Araujo, Journal of Money, Credit and Banking, June 2026, PDF: Optimal Payment
“Physical vs Digital Currency: A Difference that Makes a Difference”, with N. Amendola and L. Araujo, Theoretical Economics, July 2026, PDF: Physical vs Digital Currency
WORKING PAPERS
“Experimenting with Digital Currency”, with L. Araujo, M. Mantovani and D. Puzzello
“Follow the Money: Traceability vs Programmability of Digital Currencies”, with L. Araujo
“The Politics of Taking Turns”, with F. De Sinopoli, G. Iannantuoni and C. Meroni
BOOKS
Lineamenti di Macroeconomia, EGEA, 2021, with N. Amendola and L. Carbonari
Macroeconomia: il Minimo Teorico, EGEA, 2024, with N. Amendola and L. Carbonari
Macroeconomic Theory: A Primer, Springer, 2025
Tutto si trasforma. Sei pezzi facili per capire l'economia, EGEA, 2026, with G. Iannantuoni