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Financial Intermediary In Monetary Economics: An Excerpt

Listed author(s):
  • Demid Golikov

This is a short literature overview. (1) The literature demonstrates no coherent view on the nature of economic exchange and, in particular, provides no conventionally accepted, fully satisfactory explanation of the real effects of money. Recent developments in macroeconomics suggest a role for financial intermediaries. (2) The economics literature, however, has very little to say about that though the role of intermediaries in economic history has always been emphasised. (3) Further reading suggests that intermediation is largely missing from economics for methodological reasons. Revival of interest in this topic became evident in recent years thanks to developments in the treatment of asymmetric information, thin markets, and dynamics with innovations. (4) Today's literature, however, still primarily addresses empirical and specific issues like particular functions of intermediaries. Analysis of intermediation in the context of general equilibrium, explanation of its role in the monetary transmission and non-neutrality have not been seriously undertaken. Only a few authors so far have put forward their proposals for this perspective.

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File URL: http://econwpa.repec.org/eps/mac/papers/0510/0510018.pdf
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Paper provided by EconWPA in its series Macroeconomics with number 0510018.

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Length: 18 pages
Date of creation: 20 Oct 2005
Handle: RePEc:wpa:wuwpma:0510018
Note: Type of Document - pdf; pages: 18
Contact details of provider: Web page: http://econwpa.repec.org

References listed on IDEAS
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  19. Fischer, Stanley, 1983. "A Framework for Monetary and Banking Analysis," Economic Journal, Royal Economic Society, vol. 93(369a), pages 1-16, Supplemen.
  20. Ben Bernanke, 1990. "The Federal Funds Rate and the Channels of Monetary Transnission," NBER Working Papers 3487, National Bureau of Economic Research, Inc.
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  32. repec:nbr:nberre:0126 is not listed on IDEAS
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