Liquid money controlled by a trustworthy central bank can serve as an insurance against external surprises such as … insurance property of money is particularly accentuated. The paper constructs a life cycle framework for the analysis of … rational and irrational motives to save money, answers to questions about the effects of saving liquid money on labor supply …

tightening. Besides, small banks are found to suffer more as their credit risk and liquidity risk increase. We show that lending … relationships benefit banks in hedging liquidity risk. We also document that central bank liquidity increments are associated with a … demand for liquidity in the interbank market as wells as banks' access to this market. Results indicate that riskier banks …