1974 | OriginalPaper | Buchkapitel
Commercial Banks and the Money Supply
verfasst von : D. C. Rowan
Erschienen in: Output, Inflation and Growth
Verlag: Macmillan Education UK
Enthalten in: Professional Book Archive
Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.
Wählen Sie Textabschnitte aus um mit Künstlicher Intelligenz passenden Patente zu finden. powered by
Markieren Sie Textabschnitte, um KI-gestützt weitere passende Inhalte zu finden. powered by
In
the previous chapter we saw that modern money consists of two components: (i) demand deposits with the commercial banks; (ii) notes. Of these the first, and most important component, consists of liabilities of the
commercial banks
, the second of liabilities of the
central bank
. Since we have defined the money supply as:
the nominal value of demand deposits and notes held by the non-bank public
it follows that, to explain its determination, we must examine the behaviour of the commercial banks and the central bank for, just as an individual controls the nominal value of the I.O.U.s he issues, so do banks and, in doing so, the latter control the money supply.