Loanable funds vs money creation in banking : a benchmark result

Salomon Faure and Hans Gersbach

We establish a benchmark result for the relationship between the loanablefunds and the money-creation approach to banking. In particular, we show that both processes yield the same allocations when there is no uncertainty and thus no bank default. In such cases, using the much simpler loanablefunds approach as a shortcut does not imply any loss of generality.

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Year of publication:	[November 15, 2017] ; This version: November 2017
Authors:	Faure, Salomon A. ; Gersbach, Hans
Publisher:	Frankfurt am Main, Germany : Center for Financial Studies, Goethe University
Subject:	money creation \| bank deposits \| capital regulation \| monetary policy \| loanable funds \| Geldpolitik \| Monetary policy \| Geldschöpfung \| Money creation \| Geldmenge \| Money supply \| Bankenliquidität \| Bank liquidity \| Zins \| Interest rate \| Basler Akkord \| Basel Accord \| Einlagengeschäft \| Deposit banking \| Geldtheorie \| Monetary theory

Extent:	1 Online-Ressource (circa 52 Seiten) Illustrationen
Series:	CFS working paper series. - Frankfurt, M. : [Verlag nicht ermittelbar], ZDB-ID 2196856-1. - Vol. no. 587 CFS Working Paper ; No. 587, 2017
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Arbeitspapier ; Working Paper ; Graue Literatur ; Non-commercial literature
Language:	English
Other identifiers:	10.2139/ssrn.3084152 [DOI] hdl:10419/172466 [Handle]
Classification:	D50 - General Equilibrium and Disequilibrium. General ; E4 - Money and Interest Rates ; E5 - Monetary Policy, Central Banking and the Supply of Money and Credit ; G21 - Banks; Other Depository Institutions; Mortgages
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10011760873