IDEAS home Printed from https://ideas.repec.org/a/bpj/aelcon/v8y2018i2p26n3.html
   My bibliography  Save this article

Banking, Money and Credit: A Systemic Perspective

Author

Listed:
  • Biondi Yuri

    (IRISSO, Cnrs, UMR7170, University Paris Dauphine PSL, Paris, France)

Abstract

Contemporaneous banking theories appear to understand financial institutions as intermediaries, relegating bank money creation through money multiplication outside the core of banking activity. This article takes a different systemic perspective, pointing to the dynamic and collective features that generate a banking system within and across financial institutions. Classic features such as bank credit creation, as well as classic issues such as bank runs, are reconsidered under the notion of a ‘banking system’ requiring coordination over time and circumstances.

Suggested Citation

  • Biondi Yuri, 2018. "Banking, Money and Credit: A Systemic Perspective," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 8(2), pages 1-26, July.
    • Handle: RePEc:bpj:aelcon:v:8:y:2018:i:2:p:26:n:3
    DOI: 10.1515/ael-2017-0047
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/ael-2017-0047
    Download Restriction: Download restriction for institutions: For access to full text, subscription to the journal is required. Individual readers who register with De Gruyter Online get free access.
    File URL: https://libkey.io/10.1515/ael-2017-0047?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Schwarz Claudia & Karakitsos Polychronis & Merriman Niall & Studener Werner, 2015. "Why Accounting Matters: A Central Bank Perspective," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 5(1), pages 1-42, March.
    2. Arvind Krishnamurthy & Annette Vissing-Jorgensen, 2012. "The Aggregate Demand for Treasury Debt," Journal of Political Economy, University of Chicago Press, vol. 120(2), pages 233-267.
    3. Stephen G. Cecchetti, 2008. "Measuring the Macroeconomic Risks Posed by Asset Price Booms," NBER Chapters, in: Asset Prices and Monetary Policy, pages 9-43, National Bureau of Economic Research, Inc.
    4. Dietrich DOMANSKI, 2018. "Achieving the G20 goal of resilient market-based finance," Financial Stability Review, Banque de France, issue 22, pages 155-177, April.
    5. Luca Fantacci, 2013. "Reforming Money to Exit the Crisis: Examples of Non-capitalist Monetary Systems in Theory and Practice," Palgrave Macmillan Books, in: Jocelyn Pixley & G. C. Harcourt (ed.), Financial Crises and the Nature of Capitalist Money, chapter 7, pages 124-147, Palgrave Macmillan.
    6. Daniela Gabor & Cornel Ban, 2016. "Banking on Bonds: The New Links Between States and Markets," Journal of Common Market Studies, Wiley Blackwell, vol. 54(3), pages 617-635, May.
    7. Adrian, T. & Shin, H S., 2009. "The shadow banking system: implications for fi nancial regulation," Financial Stability Review, Banque de France, issue 13, pages 1-10, September.
    8. Barrdear, John & Kumhof, Michael, 2016. "The macroeconomics of central bank issued digital currencies," Bank of England working papers 605, Bank of England.
    9. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 24(Win), pages 14-23.
    10. Werner, Richard A., 2014. "Can banks individually create money out of nothing? — The theories and the empirical evidence," International Review of Financial Analysis, Elsevier, vol. 36(C), pages 1-19.
    11. Douglas W. Diamond & Raghuram G. Rajan, 2001. "Liquidity Risk, Liquidity Creation, and Financial Fragility: A Theory of Banking," Journal of Political Economy, University of Chicago Press, vol. 109(2), pages 287-327, April.
    12. Gorton, Gary & Pennacchi, George, 1990. "Financial Intermediaries and Liquidity Creation," Journal of Finance, American Finance Association, vol. 45(1), pages 49-71, March.
    13. Calomiris, Charles W & Kahn, Charles M, 1991. "The Role of Demandable Debt in Structuring Optimal Banking Arrangements," American Economic Review, American Economic Association, vol. 81(3), pages 497-513, June.
    14. Pistor, Katharina, 2013. "A legal theory of finance," Journal of Comparative Economics, Elsevier, vol. 41(2), pages 315-330.
    15. Adrian, Tobias & Breuer, Peter & Ashcraft, Adam & Cetorelli, Nicola, 2018. "A Review of Shadow Banking," CEPR Discussion Papers 13363, C.E.P.R. Discussion Papers.
    16. Jakab, Zoltan & Kumhof, Michael, 2015. "Banks are not intermediaries of loanable funds – and why this matters," Bank of England working papers 529, Bank of England.
    17. Shubik Martin, 2011. "A Note on Accounting and Economic Theory: Past, Present, and Future," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(1), pages 1-26, January.
    18. Yuri Biondi, 2005. "The firm as an Entity: Management, Organization, Accounting," Post-Print halshs-00203036, HAL.
    19. Werner, Richard A., 2014. "How do banks create money, and why can other firms not do the same? An explanation for the coexistence of lending and deposit-taking," International Review of Financial Analysis, Elsevier, vol. 36(C), pages 71-77.
    20. Stout Lynn A., 2011. "Risk, Speculation, and OTC Derivatives: An Inaugural Essay for Convivium," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(1), pages 1-15, January.
    21. Admati, Anat R. & Hellwig, Martin F., 2013. "Does Debt Discipline Bankers? An Academic Myth about Bank Indebtedness," Research Papers 3031, Stanford University, Graduate School of Business.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gaffeo Edoardo & Gobbi Lucio, 2021. "Achieving financial stability during a liquidity crisis: a multi-objective approach," Risk Management, Palgrave Macmillan, vol. 23(1), pages 48-74, June.
    2. Yuri Biondi & Feng Zhou, 2019. "Interbank credit and the money manufacturing process: a systemic perspective on financial stability," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 14(3), pages 437-468, September.
    3. Ricks Morgan, 2018. "The Money Problem: A Rejoinder," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 8(2), pages 1-3, July.
    4. Boussard Valerie, 2020. "Social Dynamics behind Financialisation: About the Book ‘Finance at Work’," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 10(1), pages 1-4, March.
    5. Morteza Alaeddini & Philippe Madiès & Paul J. Reaidy & Julie Dugdale, 2023. "Interbank money market concerns and actors’ strategies—A systematic review of 21st century literature," Journal of Economic Surveys, Wiley Blackwell, vol. 37(2), pages 573-654, April.
    6. Biondi Yuri, 2019. "Equilibrium and System Analysis in Economic Dynamics," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 9(3), pages 1-10, December.
    7. Moe Thorvald Grung, 2018. "Financial Stability and Money Creation: A Review of Morgan Ricks: The Money Problem," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 8(2), pages 1-16, July.
    8. Ahmad Rado Rizkullah & Suhel & Sri Andaiyani, 2023. "Determinants of Credit Growth: An Empirical Study of Commercial Banks in Indonesia," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 22(2), pages 404-424.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yuri Biondi & Feng Zhou, 2019. "Interbank credit and the money manufacturing process: a systemic perspective on financial stability," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 14(3), pages 437-468, September.
    2. DeAngelo, Harry & Stulz, René M., 2015. "Liquid-claim production, risk management, and bank capital structure: Why high leverage is optimal for banks," Journal of Financial Economics, Elsevier, vol. 116(2), pages 219-236.
    3. Kreamer, Jonathan, 2022. "Financial intermediation and the supply of liquidity," Journal of Financial Stability, Elsevier, vol. 61(C).
    4. Enrico Perotti & Toni Ahnert, 2015. "Cheap but Flighty: How Global Imbalances create Financial Fragility," Tinbergen Institute Discussion Papers 15-036/IV/DSF89, Tinbergen Institute.
    5. Donaldson, Jason Roderick & Piacentino, Giorgia & Thakor, Anjan, 2018. "Warehouse banking," Journal of Financial Economics, Elsevier, vol. 129(2), pages 250-267.
    6. Douglas Gale & Tanju Yorulmazer, 2020. "Bank capital, fire sales, and the social value of deposits," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 69(4), pages 919-963, June.
    7. Kristian Blickle & Markus K. Brunnermeier & Stephan Luck, 2022. "Who Can Tell Which Banks Will Fail?," NBER Working Papers 29753, National Bureau of Economic Research, Inc.
    8. Toni Ahnert & Enrico Perotti, 2018. "Seeking Safety," Staff Working Papers 18-41, Bank of Canada.
    9. Werner, Richard A., 2016. "A lost century in economics: Three theories of banking and the conclusive evidence," International Review of Financial Analysis, Elsevier, vol. 46(C), pages 361-379.
    10. Michiel Bijlsma & Wouter Elsenburg & Michiel van Leuvensteijn, 2010. "Four Futures for Finance; A scenario study," CPB Document 211.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    11. Chatterji, Shurojit; Ghosal, Sayantan, 2010. "Liquidity, moral hazard and bank crises," CAGE Online Working Paper Series 27, Competitive Advantage in the Global Economy (CAGE).
    12. Anil K. Kashyap & Raghuram Rajan & Jeremy C. Stein, 2002. "Banks as Liquidity Providers: An Explanation for the Coexistence of Lending and Deposit‐taking," Journal of Finance, American Finance Association, vol. 57(1), pages 33-73, February.
    13. Chatterji, S. & Ghosal, S., 2008. "Moral hazard, bank runs and contagion," Economic Research Papers 269785, University of Warwick - Department of Economics.
    14. James J. McAndrews & William Roberds, 1999. "Payment intermediation and the origins of banking," Staff Reports 85, Federal Reserve Bank of New York.
    15. Ahnert, Toni & Martinez-Miera, David, 2021. "Bank Runs, Bank Competition and Opacity," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242348, Verein für Socialpolitik / German Economic Association.
    16. Thomas Philippon, 2015. "Has the US Finance Industry Become Less Efficient? On the Theory and Measurement of Financial Intermediation," American Economic Review, American Economic Association, vol. 105(4), pages 1408-1438, April.
    17. Anatoli Segura & Javier Suarez, 2017. "How Excessive Is Banks’ Maturity Transformation?," The Review of Financial Studies, Society for Financial Studies, vol. 30(10), pages 3538-3580.
    18. Haelim Anderson & Daniel Barth & Dong Beom Choi, 2018. "Reducing Moral Hazard at the Expense of Market Discipline: The Effectiveness of Double Liability Before and During the Great Depression," Working Papers 18-06, Office of Financial Research, US Department of the Treasury.
    19. Mark Egan & Stefan Lewellen & Adi Sunderam, 2017. "The Cross Section of Bank Value," NBER Working Papers 23291, National Bureau of Economic Research, Inc.
    20. Bolton, Patrick & Oehmke, Martin, 2019. "Bank resolution and the structure of global banks," LSE Research Online Documents on Economics 90056, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    banking; financial regulation; money; credit;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:aelcon:v:8:y:2018:i:2:p:26:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.