Arbeitspapier
Liquidity
This paper develops a general equilibrium model of two traditional explanations of the monetary "black box" linking money and real activity: the liquidity effect and the loanable funds effect. These effects are modeled with a monetary production economy in which central bank injections of cash are funnelled into the economy through the credit market. As a result, only borrowers have direct access to the newly injected cash. The model has several interesting implications: 1) monetary injections cause fluctuations in asset prices for non-Fisherian reasons, 2) monetary injections increase current and future real activity, and, 3) the central bank has the ability to dampen or magnify fluctuations in real activity.
- Sprache
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Englisch
- Erschienen in
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Series: Discussion Paper ; No. 900
- Klassifikation
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Wirtschaft
- Ereignis
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Geistige Schöpfung
- (wer)
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Fuerst, Timothy S.
- Ereignis
-
Veröffentlichung
- (wer)
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Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science
- (wo)
-
Evanston, IL
- (wann)
-
1990
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Fuerst, Timothy S.
- Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science
Entstanden
- 1990