, where banks make loans repayable in goods and depositors hold claims on the bank payable on demand in goods. Aggregate … production may be delayed in the economy. If so, we show that the level of ongoing bank lending, and hence of aggregate future … reduction of total output. A number of inefficiencies including bank failures can result if deposits turn out to be too high. We …

averse banks. The effects of changes in bank net worth and bank's risk perceptions are also analyzed. In deep recessions …

analysis of monetary policy by both academic and central bank economists has been increasingly conducted in small quantitative …