The Analysis of Money Arrow-Debreu-McKenzie (ADM) Model Using Recursive Approach (Recommendation of New Criteria: BAVA)

General equilibrium, as an important issue, was initiated by Wallrace in economics. One of the general equilibrium models, what is called Arrow-Debreu-McKenzie (ADM) model. In this model time differential and its effect on the concept of commodity is emphasiezed and exogenous money will be set pareto effincy in economics. The main question is: does monetary ADM using recursive approach, have pareto effincy in economy at RCE when the agents have hetergenous incomes in the form of intergenetational equities? This paper, uses analytical approach in a new viewpoint to criticize monetary ADM. The results have shown that because of the hetergenous structure, fiat money would not obtain pareto optimality. So new criteria, BAVA's criteria based on intergenetational aggregation is recommended. This contribution opens a new approach to theorizing of new field of endogenous monetary literature.