The Experts below are selected from a list of 360 Experts worldwide ranked by ideXlab platform
Randall Wright - One of the best experts on this subject based on the ideXlab platform.
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a unified framework for Monetary Theory and policy analysis
Journal of Political Economy, 2005Co-Authors: Ricardo Lagos, Randall WrightAbstract:Search-theoretic models of Monetary exchange are based on explicit descriptions of the frictions that make money essential. However, tractable versions of these models typically make strong assumptions that render them ill suited for Monetary policy analysis. We propose a new framework, based on explicit micro foundations, within which macro policy can be studied. The framework is analytically tractable and easily quantifiable. We calibrate the model to standard observations and use it to measure the cost of inflation. We find that going from 10 percent to 0 percent inflation is worth between 3 and 5 percent of consumption—much higher than previous estimates.
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a unified framework for Monetary Theory and policy analysis
2002Co-Authors: Ricardo Lagos, Randall WrightAbstract:Search-theoretic models of Monetary exchange are based on explicit descriptions of the frictions that make money essential. However, tractable versions usually have strong assumptions that make them ill suited for discussing some policy questions, especially those concerning changes in the money supply. Hence, most policy analysis uses reduced-form models. The authors propose a framework, designed to help bridge this gap, that is based explicitly on microeconomic frictions, but allows for interesting macroeconomic policy analyses. At the same time, the model is analytically tractable and amenable to quantitative analysis.
Ricardo Lagos - One of the best experts on this subject based on the ideXlab platform.
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a unified framework for Monetary Theory and policy analysis
Journal of Political Economy, 2005Co-Authors: Ricardo Lagos, Randall WrightAbstract:Search-theoretic models of Monetary exchange are based on explicit descriptions of the frictions that make money essential. However, tractable versions of these models typically make strong assumptions that render them ill suited for Monetary policy analysis. We propose a new framework, based on explicit micro foundations, within which macro policy can be studied. The framework is analytically tractable and easily quantifiable. We calibrate the model to standard observations and use it to measure the cost of inflation. We find that going from 10 percent to 0 percent inflation is worth between 3 and 5 percent of consumption—much higher than previous estimates.
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a unified framework for Monetary Theory and policy analysis
2002Co-Authors: Ricardo Lagos, Randall WrightAbstract:Search-theoretic models of Monetary exchange are based on explicit descriptions of the frictions that make money essential. However, tractable versions usually have strong assumptions that make them ill suited for discussing some policy questions, especially those concerning changes in the money supply. Hence, most policy analysis uses reduced-form models. The authors propose a framework, designed to help bridge this gap, that is based explicitly on microeconomic frictions, but allows for interesting macroeconomic policy analyses. At the same time, the model is analytically tractable and amenable to quantitative analysis.
Marc Lavoie - One of the best experts on this subject based on the ideXlab platform.
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post keynesian Monetary economics godley like
Post-Print, 2013Co-Authors: Marc LavoieAbstract:Endogenous money is a key feature of post-Keynesian Monetary economics and of Monetary circuit Theory. This chapter highlights the contributions and the evolution of Wynne Godley’s views on money, as they have evolved toward what Godley first called the real stock flow Monetary model, which later became known as the stock-flow coherent model, showing that his views encompass post-Keynesian economics and Monetary circuit Theory. The chapter first recapitulates what it considers to be the main features of post-Keynesian Monetary analysis. It then presents the work of Godley and his efforts to develop a systemic understanding of an economy and how money comes about. It also considers the role of banks and how they achieve their portfolio objectives. Finally, it explores how these stock-flow coherent principles fit in the context of an open economy and discusses some implications of the subprime financial crisis for Monetary Theory.
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changes in central bank procedures during the subprime crisis and their repercussions on Monetary Theory
International Journal of Political Economy, 2010Co-Authors: Marc LavoieAbstract:The subprime financial crisis has forced several central banks to take extraordinary measures and to modify some of their operational procedures. These changes have made the deficiencies and lack of realism of mainstream Monetary Theory even clearer, as can be seen in undergraduate textbooks as well as in most macroeconomic models. They have forced Monetary authorities to publicly reject some of the assumptions and key features of mainstream Monetary Theory, fearing that, on that mistaken basis, actors in the financial markets would misrepresent and misjudge the consequences of the actions taken by the Monetary authorities. These changes in operational procedures also have some implications for heterodox Monetary Theory, in particular for post-Keynesian Theory. My objective in this article is to analyze the implications of these changes in operational procedures for an understanding of Monetary Theory. I take the evolution of the operating procedures of the Federal Reserve since August 2007 as an exemplar...
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changes in central bank procedures during the subprime crisis and their repercussions on Monetary Theory
Research Papers in Economics, 2010Co-Authors: Marc LavoieAbstract:The subprime financial crisis has forced several North American and European central banks to take extraordinary measures and to modify some of their operational procedures. These changes have made even clearer the deficiencies and lack of realism in mainstream Monetary Theory, as can be found in both undergraduate textbooks and most macroeconomic models. They have also forced Monetary authorities to reject publicly some of the assumptions and key features of mainstream Monetary Theory, fearing that, on that mistaken basis, actors in the financial markets would misrepresent and misjudge the consequences of the actions taken by the Monetary authorities. These changes in operational procedures also have some implications for heterodox Monetary Theory; in particular, for post-Keynesian Theory. The objective of this paper is to analyze the implications of these changes in operational procedures for our understanding of Monetary Theory. The evolution of the operating procedures of the Federal Reserve since August 2007 is taken as an exemplar. The American case is particularly interesting, both because it was at the center of the financial crisis and because the U.S. Monetary system and its federal funds rate market are the main sources of theorizing in Monetary economics.
Robert M Townsend - One of the best experts on this subject based on the ideXlab platform.
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Monetary Theory and electronic money reflections on the kenyan experience
Social Science Research Network, 2010Co-Authors: William Jack, Tavneet Suri, Robert M TownsendAbstract:This article uses a class of models of money and the payments system to inform an analysis of "mobile banking" in the context of the rapid expansion of M-PESA, a new technology in Kenya that allows payments via mobile phones (even without any access to a bank account), and currently reaches close to 38 percent of Kenyan adults. The separation of households and firms in space and time suggests, in Theory, from various separate models, a number of implications. These include (i) the potential gain, under some circumstances, from allowing net e-money credit creation, (ii) the impact that the associated enhancement of credit markets can have on Monetary policy and on the real economy, (iii) the roles that e-money could play not only in credit but also in insurance, unrelated to its payment function, (iv) the potential role for an activist Monetary policy and e-money management, (v) the role of e-money as a circulating private debt and as a store of value though with potential coordination problems associated with achieving balanced security transformation, (vi) the potential welfare losses from insisting on continuous net clearing of cash and e-money and the difficulty, in any event, of achieving this in practice, and (vii) the management of shortages in the context of fixed rates of exchange of e-money for cash. We provide some summary statistics from data collected on M-PESA agents and users that are reminiscent of the environments of the models and that support some of these implications. Other implications of the models suggest reforms to enhance the system's efficiency.
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Monetary Theory and electronic money reflections on the kenyan experience
Economic Quarterly - Federal Reserve Bank of Richmond, 2010Co-Authors: William Jack, Tavneet Suri, Robert M TownsendAbstract:In 2007, the leading cell phone company in Kenya, Safaricom Ltd., launched M-PESA, a short message service (SMS)-based money transfer system that allows individuals to deposit, send, and withdraw funds from a virtual account on their cell phones and that is separate from the banking system. M-PESA has grown rapidly, currently reaching more than seven million users, approximately 38 percent of Kenya’s adult population, and it is widely viewed as a success story to be emulated across the developing world. Indeed, similar products have recently been launched in a growing number of countries acrossAfrica,Asia, and LatinAmerica, with the intent of expanding financial services to previously unreached populations. 1
Dean P Corbae - One of the best experts on this subject based on the ideXlab platform.
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endogenous market participation and the general equilibrium value of money
Journal of Political Economy, 1992Co-Authors: Satyajit Chatterjee, Dean P CorbaeAbstract:The authors study the Monetary Theory implications of fixed costs associated with trade in private assets. The authors show that with heterogeneous endowment profiles it is possible for an endogenous subset of agents to hold currency even when it is dominated in return by a competing asset. With respect to positive issues in Monetary Theory, the model implies that changes in the steady-state growth rate of the money supply have a negative effect on real interest rates because of endogenous market participation measures. On the normative side, the authors show that there may be an equity-efficiency trade-off from Monetary deflation. Copyright 1992 by University of Chicago Press.
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endogenous market participation and the general equilibrium value of money
Journal of Political Economy, 1992Co-Authors: Satyajit Chatterjee, Dean P CorbaeAbstract:We study the Monetary Theory implications of fixed costs associated with trade in private assets. We show that with heterogeneous endowment profiles it is possible for an endogenous subset of agents to hold currency even when it is dominated in return by a competing asset. With respect to positive issues in Monetary Theory, the model implies that changes in the steady-state growth rate of the money supply have a negative effect on real interest rates because of endogenous market participation measures. On the normative side, we show that there may be an equity-efficiency trade-off from Monetary deflation.
