Year: 1988
Author: Allsbrook, Odgen O., Gilliam, Kenneth P.
Credit and Capital Markets – Kredit und Kapital, Vol. 21 (1988), Iss. 2 : pp. 243–252
Abstract
A Cyclical Interpretation of Money
This article develops a cyclical analysis of velocity as it varies over a stylized business cycle. Velocity varies historically in a predictable cyclical fashion, so the IS-LM paradigm is employed to illustrate why these changes are expected. A critical distinction lies in the difference between the stock of money and the flow of money. The former is exogenous, while the latter is endogenous and includes changes in velocity. The two phases of the cycle rationalized in this manner are disinflation and accelerating inflation. The expected effects on yield curves during these phases are drawn. Thus an attempt is made to subject the financial side of the economy (LM) to the same flexibility that the expenditure side of the economy (15) has been subjected by the alternative consumption/saving hypotheses.
Journal Article Details
Publisher Name: Global Science Press
Language: Multiple languages
DOI: https://doi.org/10.3790/ccm.21.2.243
Credit and Capital Markets – Kredit und Kapital, Vol. 21 (1988), Iss. 2 : pp. 243–252
Published online: 1988-02
AMS Subject Headings: Duncker & Humblot
Copyright: COPYRIGHT: © Global Science Press
Pages: 10
Author Details
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