Open-market operations in a model of regulated, insured intermediaries
In “The Inefficiency of Interest-Bearing National Debt,” (JPE, April 1979) we argued that private sector transaction costs are needed in order to explain interest on government debt. It follows that if the government’s transaction costs do not depend on its portfolio, then, barring special circumstances, an open-market purchase is deflationary and welfare improving. In this paper we show that this result can survive a potentially relevant special circumstance: reserve requirements which limit the size of insured intermediaries.
Year of publication: |
1978
|
---|---|
Authors: | Bryant, John ; Wallace, Neil |
Institutions: | Federal Reserve Bank of Minneapolis |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Monetary policy in the presence of a stochastic deficit
Bryant, John, (1979)
-
A price discrimination analysis of monetary policy
Bryant, John, (1983)
-
A suggestion for further simplifying the theory of money
Bryant, John, (1980)
- More ...