resources in the form of deposits. Therefore, bank credit needs to be modelled as a monetary phenomenon, which directly fuels … closely resembles that of credit, which allows us to analyse real and nominal consequences of bank credit (and money) creation. …

This paper documents a strong connection between payment system and credit supply. The dual role of deposits as … the average level of aggregate credit supply by 9% while amplify the volatility by 20%. We identify a small subset of … banks that have a disproportionately large influence on credit supply due to their special positions in the payment …