The Payments System, Liquidity, and Rediscounting
Year: 1996
Type: preprint
Abstract: In an economy where fiat money serves both as a medium of exchange and the means by which debts are cleared, it is shown that nonoptimal equilibria of constrained liquidity may arise. Optimality may be restored by temporary expansions of the monetary base (e.g., an active central-bank 'discount window'). Copyright 1996 by American Economic Association.
Source: SSRN Electronic Journal
Author: Scott Freeman
Institution: The University of Texas at Austin
Language: English
Topic: Economic theories and models
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1564078074