Forward-Looking, Stochastic Cash Management and the Demand for Money
This paper aims to connect money demand theory with optimal inventory theory and with time series evidence. An agent's problem of minimizing cash-management costs is of a familiar threshold form. Closed-form expressions are derived in a special case. The theory implies that expected future interest rates may influence money holdings despite the absence of strictly convex adjustment cots. A distributed-lag expression for these holdings is proposed in which the adjustment and expectations dynamics are derived from theory.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
|Date of creation:||1986|
|Contact details of provider:|| Postal: Kingston, Ontario, K7L 3N6|
Phone: (613) 533-2250
Fax: (613) 533-6668
Web page: http://qed.econ.queensu.ca/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:qed:wpaper:673. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Babcock)
If references are entirely missing, you can add them using this form.