In most banking models, money is merely modeled as medium for transaction, but in reality, money is also the most liquid asset for banks. Central banks do not only passively supply money to meet demand for transaction, as often assumed in these models, instead they also actively inject liquidity...

Why do advanced economies fall into prolonged periods of economic stagnation? What is the role of asset prices and private sector indebtedness for the transition to and the severity of stagnation? In this paper, we present a stylized money-in-the- utility model with a housing sector and...