This paper presents a small macroeconomic model describing the main mechanisms of the process of credit creation by the private banking system. The model is composed of a core unit — where the dynamics of income, credit, and aggregate demand are determined — and a set of sectoral accounts...

This paper presents a small macroeconomic model describing the main mechanisms of the process of credit creation by the private banking system. The model is composed of a core unit - where the dynamics of income, credit, and aggregate demand are determined - and a set of sectoral accounts that...