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Financial equilibrium in the presence of technological change

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  • Wasniewski, Krzysztof

Abstract

This article explores the issue of observable instability in financial markets interpreted as a long-term process of adaptation to demand for money, which, in turn, is based on the expected depreciation of fixed assets. Exploration is based on verifying empirically the hypothesis that the velocity of money is significantly, negatively correlated with the pace of technological change. The purpose of exploration is to assess the well-founded of policies, which use financial and monetary tools, rather than the straightforwardly fiscal ones, to stimulate technological change. Empirical research suggests that aggregate depreciation of fixed assets is a significant factor inducing slower a circulation of money.

Suggested Citation

  • Wasniewski, Krzysztof, 2017. "Financial equilibrium in the presence of technological change," MPRA Paper 79426, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:79426
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    References listed on IDEAS

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    2. Robert C. Feenstra & Robert Inklaar & Marcel P. Timmer, 2015. "The Next Generation of the Penn World Table," American Economic Review, American Economic Association, vol. 105(10), pages 3150-3182, October.
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    4. Paul A. Samuelson, 1958. "An Exact Consumption-Loan Model of Interest with or without the Social Contrivance of Money," Journal of Political Economy, University of Chicago Press, vol. 66(6), pages 467-467.
    5. Charles P. Kindleberger & Robert Z. Aliber, 2005. "Manias, Panics and Crashes," Palgrave Macmillan Books, Palgrave Macmillan, edition 0, number 978-0-230-62804-5.
    6. Anonymous, 1958. "International Bank for Reconstruction and Development," International Organization, Cambridge University Press, vol. 12(2), pages 216-219, April.
    7. Hyman P. Minsky, 1992. "The Financial Instability Hypothesis," Economics Working Paper Archive wp_74, Levy Economics Institute.
    8. Anonymous, 1958. "International Bank for Reconstruction and Development," International Organization, Cambridge University Press, vol. 12(1), pages 146-149, January.
    9. Anonymous, 1958. "International Bank for Reconstruction and Development," International Organization, Cambridge University Press, vol. 12(4), pages 538-541, October.
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    Cited by:

    1. Wasniewski, Krzysztof, 2020. "Energy efficiency as manifestation of collective intelligence in human societies," Energy, Elsevier, vol. 191(C).

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    More about this item

    Keywords

    money; financial markets; technological change;
    All these keywords.

    JEL classification:

    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles

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