The Neutralized Money Stock: A Reconstruction

1983 ◽  
pp. 25-41
Author(s):  
M. Ray Perryman
Keyword(s):  
Money Stock

Estimating the Quantitative Importance of Various Sources of Macroeconomic Variability

1994 ◽  
Vol 33 (4II) ◽  
pp. 1073-1087
Author(s):  
Rizwan Thair
Keyword(s):  
Research Agenda ◽  
Oil Price ◽  
Macroeconomic Fluctuations ◽  
Early 20Th Century ◽  
Technology Shocks ◽  
Money Stock ◽  
Price Shocks ◽  
The Business Cycle ◽  
Structural Shifts ◽  
Quantitative Importance

Providing a reasonable explanation for the business cycle has been the research agenda for many economists since the early 20th century, from Mitchell (1913), Pigou (1927) and Adelman and Adelman (1959) to Lucas (1972), Black (1982) and King and Plosser (1984). For a review, see Zarnowitz (1985). Most attempts to explain the sources of macroeconomic fluctuations' attribute the variability in output and prices to only a few sources, sometimes to\mJ.y one. Kydland and Prescott (1982) and others proposed technology shocks as the main source of aggregate variability; Barro (1977) pointed to unanticipated changes in money stock; Lilien (1982) argued for 'unusual structural shifts' such as changes in the demand for goods relative to services, and Hamilton (1983) concluded in favour of oil price shocks.

Mad Money Stock Calls and Retail Investor Behavior

2014 ◽  
Author(s):  
Jose A. Gutierrez ◽  
Robert Stretcher
Keyword(s):  
Investor Behavior ◽  
Money Stock ◽  
Retail Investor

scholarly journals A Bootstrap Method to Test Granger-Causality in the Frequency Domain

2021 ◽  
Author(s):  
Matteo Farnè ◽  
Angela Montanari
Keyword(s):  
Stochastic Process ◽  
Frequency Domain ◽  
Granger Causality ◽  
Bootstrap Method ◽  
Money Stock ◽  
Bootstrap Test ◽  
Low Frequencies ◽  
Economic Output ◽  
Stationary Bootstrap ◽  
The Relationship

AbstractWe propose a bootstrap test for unconditional and conditional Granger-causality spectra in the frequency domain. Our test aims to detect if the causality at a particular frequency is systematically different from zero. In particular, we consider a stochastic process derived applying independently the stationary bootstrap to the original series. At each frequency, we test the sample causality against the distribution of the median causality across frequencies estimated for that process. Via our procedure, we infer about the relationship between money stock and GDP in the Euro Area during the period 1999–2017. We point out that the money stock aggregate M1 had a significant impact on economic output at all frequencies, while the opposite relationship is significant only at low frequencies.

scholarly journals Elements of Money Stock Determination

1969 ◽  
Vol 51 ◽  
Author(s):  
Jerry L. Jordan
Keyword(s):  
Money Stock

scholarly journals The Deutsche Bundesbank's Concept of Monetary Policy, With Particular Reference to its Choice of Intermediate Variables in the Period 1972-1979

2021 ◽  
Author(s):  
◽  
Petrus Simons
Keyword(s):  
Monetary Policy ◽  
Public Sector ◽  
Foreign Capital ◽  
Bank Lending ◽  
Capital Formation ◽  
Wage Bargaining ◽  
Price Stability ◽  
Money Stock ◽  
Intermediate Target ◽  
Loan Rate

<p>The maintenance of price stability is the Bundesbank's ultimate objective. The memory of two hyperinflations within a 30-year period has made the fight against inflation of paramount social and political importance. In the Bank's view inflation engenders uncertainties which may jeopardise capital investment on which the competitiveness of German industry as well as full employment and economic growth depends. The Bundesbank pursues this goal by setting the marginal cost of central bank money required by the banks to finance their expansion. Thus, both the liquidity of the banking system and the cost of borrowing are controlled. This does not necessarily mean that the banks' loan rate of interest is the Bundesbank's Intermediate target. In fact, the Bank does not have one single intermediate target. Since the Bank's views of the monetary sector are manifested in the form of an interlocking system of financial variables, the selection of an appropriate intermediate target depends on the actual economic situation. In this context, the money stock supply (M3) is seen by the Bundesbank as functionally related to bank lending and the accumulation of long-term funds at the banks (monetary capital formation). An increase in interest rates would reduce bank lending, stimulate monetary capital formation and hence reduce the money stock supply (M3). In addition, it would check the utilisation of the money stock supply. This is seen as important because once money has entered the system it may generate unacceptable expenditure flows. To control the growth of the money stock supply, the Bundesbank relies on monetary capital formation, because small stocks of public debt rule out large-scale open market operations. In the Bank's view monetary policy should aim at keeping the banks' loan rate of interest as closely as possible to the natural rate. Lags in this Wicksellian transmission process may arise if the banks have ample margins between their loan and deposit rates when a restrictive monetary policy is implemented. As deposit rates adjust sooner than loan rates to a change in market rates, this also blunts the immediate impact of a policy change. The Bundesbank favours flexible rates of exchange in order to safeguard the financial system against inflows of foreign capital. It would welcome an appreciation of the D-Mark as a contribution to price stability, even though it could result in a loss of employment and exports as it stimulates German business to invest abroad. Furthermore, the Bank aims at constraining the monetary disturbances arising from public sector deficits and collective wage bargaining by means of its annual monetary growth target. This should serve as a signal to non-banks, which they are supposed to internalise in their decision-making. During the review period, the effectiveness of these safeguards was small as witnessed by inflows of foreign capital, large public sector deficits and excessive wage settlements. Moreover, the Bundesbank has been confronted with the development of parallel markets, in particular the Eurocurrency markets, in which borrowers can avoid the effects of its constraints.</p>

Back to Basics: Reserve Requirements and Money Stock Changes, 1929–1936

2000 ◽  
Vol 44 (1) ◽  
pp. 62-69 ◽  
Author(s):  
Robert F. Stauffer
Keyword(s):  
Monetary Policy ◽  
Great Depression ◽  
Federal Reserve ◽  
Money Stock ◽  
Reserve Requirement ◽  
Reserve Requirements ◽  
Money Multiplier ◽  
The Great Depression

This paper explains how the shift of deposits from nonmember banks and country banks to larger member banks increased the average or “effective” reserve requirement in the 1929–1936 period. The result was an inappropriate tightening of monetary conditions, along with liquidity problems for those banks most susceptible to failure. A basic money multiplier model is developed to help clarify the possible impact of increases in effective reserve requirements. The resulting perspective strengthens the usual charges against the Federal Reserve of monetary policy malfeasance during the Great Depression.

scholarly journals Money Stock Targeting, Base Drift and Price-Level Predictability: Lessons From the U.K. Experience

10.3386/w2825 ◽  
1989 ◽  
Author(s):  
Michael Bordo ◽  
Ehsan Choudhri ◽  
Anna Schwartz
Keyword(s):  
Price Level ◽  
Money Stock

Financial Innovation and Economic Growth

2006 ◽  
pp. 52-70
Author(s):  
Anita Ghatak
Keyword(s):  
Economic Growth ◽  
20Th Century ◽  
Financial Development ◽  
Time Series Data ◽  
Financial Innovation ◽  
Series Data ◽  
Money Stock ◽  
Long Run ◽  
Money Holding ◽  
The Uk

In this chapter, we assess the contribution of financial development to saving and economic growth in the UK in the 20th century. Financial development in this century has been by leaps and bounds along with a number of infamous crashes like the ones in the 1920s and in 1987. Using annual time-series data for the whole century, we find that financial growth has helped saving and economic growth in the UK throughout the 20th century. The unprecedented increase in money holding in 1965 and various forms of financial innovation and liberalisation initiated in the 1980s raised both the level and the rate of economic growth. Money-stock elasticity of GDP has been positive and statistically significant. There are long-run and unique co-integrated relations of GDP with productivity of capital and financial depth in the 20th century. The financial crash of Black Monday in 1987 upset equilibrium relations and led to a negative money-stock elasticity of economic growth.

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