Comparative Static Analysis in the Application of Virtual Money Market

Electronic payment is very important in electronic commerce (e-commerce) and is a base problem that restricts the development of e-commerce. As small payment system is not perfect in China, virtual money plays an important role in the electronic payment. This paper focuses on the network virtual money that serves as an instrument of small payment in e-commerce, especially in the purchases of virtual product. First, this paper has an overview of virtual money, to introduce the status of virtual money market. Then, based on the analysis of the elements of virtual money market, such as the relationship among the virtual money operators, consumer channels, the circulation of virtual money, the network players, and the government regulation, this paper establishes a circulation model and uses the comparative static analysis to verify the relationship among these factors. According to the analysis, we give an objective conclusion with the internet virtual money market.