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Despite constituting the very heart of the monetary transmission mechanism, widespreadmisconceptions still exist regarding how monetary policy is implemented. This paperhighlights the key misconceptions in this regard and shows how they have compromised theunderstanding of important aspects of...
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of money to promote its economic objectives. Forexample, Milton Friedman (1959, p. 24) defined the tools ofmonetary … policy to be those “powers that enable the [FederalReserve] System to determine the total amount of money inexistence or to … alter that amount.” In fact, the very termmonetary policy suggests a central bank’s policy toward thesupply of money or the …
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In monetary models in which agents are subject to trading shocks there is typically an ex-post inefficiency in that some agents are holding idle balances while others are cash constrained. This inefficiency creates a role for financial intermediaries, such as banks, who accept nominal deposits...
Persistent link: https://www.econbiz.de/10010277060
A central proposition in research on the role that banks play in the transmission mechanism is that monetary policy imparts a direct impact on deposits and that deposits, insofar as they constitute the supply of loanable funds, act as the driving force of bank lending. This paper argues that the...
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recount their relationship as an experiment in novel engagements with economic things (money, corporations, universities … is a specific set of projects around money and payment. The intellectual background is the anthropology of finance and …
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