Ethics de' Competitiveness in Finance: An Emancipative Structured Assessment and Evaluation of Indian Finance Industry

The details of a central bank’s monetary policy are based on assumptions about the money demand. This requires researches that aim to investigate money demand dynamics. Knowing these dynamics will support the identification of risks that may pose a threat to price stability in the long run. This study aims to analyze the changes observed in the demand for money during the last 35 years (1986-2020) in Turkey. When the analyzing period is considered as a whole in the study, it is determined that the demand for money is not stable. However, the nonlinear cointegration analysis used within the framework of soft transition models indicates that the money demand model can be divided into two different regimes with stability. In this case, it is possible to talk about the existence of a transition period in which stability is lost in the demand for money. The analyzing technique used allows the coefficients obtained for money demand to change over time according to the regime in which the economy operates. Nonlinear estimation results indicate that there is a long-term relationship between the demand for money and its macroeconomic determinants such as price level, income, interest rate, and money holding preferences of economic agents.

Is There a Change in the Money Demand Stability in Turkey? A Nonlinear Approach

The details of a central bank’s monetary policy are based on assumptions about the money demand. This requires researches that aim to investigate money demand dynamics. Knowing these dynamics will support the identification of risks that may pose a threat to price stability in the long run. This study aims to analyze the changes observed in the demand for money during the last 35 years (1986-2020) in Turkey. When the analyzing period is considered as a whole in the study, it is determined that the demand for money is not stable. However, the nonlinear cointegration analysis used within the framework of soft transition models indicates that the money demand model can be divided into two different regimes with stability. In this case, it is possible to talk about the existence of a transition period in which stability is lost in the demand for money. The analyzing technique used allows the coefficients obtained for money demand to change over time according to the regime in which the economy operates. Nonlinear estimation results indicate that there is a long-term relationship between the demand for money and its macroeconomic determinants such as price level, income, interest rate, and money holding preferences of economic agents.

Cryptoliquidity: the blockchain and monetary stability

Purpose The development of blockchain and cryptocurrency may alleviate the economic strain associated with recession. Economic recessions tend to be aggregate-demand driven, meaning that they are caused by fluctuations in the supply of or demand for money. Holding monetary policy as solution assumes that stability must arise from outside of the economic system. Under a policy regime that allows innovations in blockchain to develop, blockchain technology may promote a money supply that is responsive to changes in demand to hold money. The purpose of this paper is to suggest that cryptocurrencies present an opportunity to profitably implement rules that promote macroeconomic stability. In particular, cryptocurrency that is asset-backed may provide a means for cheaply attaining liquidity during a crisis. Design/methodology/approach The role of cryptocurrency in promoting macroeconomic equilibrium is approached through the lens of monetary theory. Moves away from macroeconomic equilibrium necessitate either a change in the average price of money or a change in the quantity of money, or a change in portfolio demand for money. Cryptocurrency promotes an increase, however this requires the alignment of policy regulating the use of cryptocurrency, reduction in taxes placed on the use of cryptocurrency and cryptocurrency protocol. Findings Cryptocurrency is unlikely to become legal tender, but it may alleviate macroeconomic fluctuations as a near money that provides liquidity and whose supply is sensitive to changes in demand to hold money and money-like substitutes. This role might be inhibited if policy stifles the development of cryptocurrencies and blockchain technology. Research limitations/implications New financial innovations like cryptocurrencies can be analyzed applying the equation of exchange in light of the mechanics of money creation under conditions of disequilibrium. Monetary disequilibrium may be promoted by policy that causes bottlenecks in financial markets. Originality/value Theory of monetary disequilibrium has broad implications for the development and regulation of financial markets. This theory has not been applied to the development of cryptocurrency markets.

The New Cash Register Design with Counterfeit Money Detection System

Cash register devices are used in every place and every shopping area in the world. Cashier takes the money from customer and put the cash register. The structure of these devices does not have any control mechanisms. If the cashier does not use any money control device, counterfeit money may deposit into the account of companies working honestly. Especially, there may be many customers in the big shopping malls and sometimes they can constitute large queues in front of the cashier. In such cases, cashier may not pay much attention to whether the money is the fake or not. In this study, a new counterfeit money detection system, which is applicable on all the cash register devices, was designed. System is based on recognition of the appearing characters above money which is illuminated with ultraviolet light. Designed detection system can be applied on the money holding mechanisms which is over the small departments in cash register drawer. In the case of any fake money detection event, system can produce an alert with light, sound or using of short message service according to the selections. Designed new system aims to protect both cashier and companies against to ill-intentioned people. The most important features of the designed system are to be cost-effective and easily assembled in the every cash register.

ENDOGENIZING CONSUMPTION DECISION IN THE FRENKEL–JOVANOVIC STOCHASTIC MODEL OF MONEY HOLDING

It is shown that the stochastic model of transaction and precautionary demand for money developed by Frenkel and Jovanovic can be made general even within the purview of their restricted treatment of the problem of estimation of optimal money holdings. While all the predecessor models on optimal money holdings assume the consumption decision to be an exogenous factor outside the realm of the model, the present treatment endogenizes the consumption decision by including an additional decision-dependent parameter in the very structure of the generalized model. In our model, it has been found that contrary to the Baumol–Tobin and Frenkel–Jovanovic models, the interest elasticity is positive when the consumption decisions are endogenous.

Financial Innovation and Economic Growth

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.