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- Title
Deregulation and Monetary Reform.
- Authors
Yeager, Leland B.
- Abstract
Currency and checkable deposits could be sharply distinguished. Unambiguously defining money and measuring its quantity has now been growing more difficult. Inflation-boosted nominal interest rates have promoted wriggling around requirements for non-interest-bearing reserves and around interest rate ceilings. Responses include money market funds, money market deposit accounts, NOW and Super-NOW accounts, overnight repurchase agreements, aspects of the Eurocurrency market, and cash-management accounts offered by brokerage houses. Deregulation has been blurring the distinction between banks and non- banks and between things that do and things that do not function as media of exchange. Despite institutional changes, the functional relation between nominal gross national product and the quantity of money will remain stable-money being properly defined. Adjusted definitions and adjusted demand or velocity functions can continue yielding good fits. According to an economist Robert Hall, monetary regulations imposed by the American and British governments of the past century create a more-or-less stable relation between a certain class of assets called money and nominal spending.
- Subjects
UNITED States; BANKING industry; MONETARY policy; FINANCE; INTEREST rates; DEREGULATION; MONEY market; NOW accounts; GROSS national product
- Publication
American Economic Review, 1985, Vol 75, Issue 2, p103
- ISSN
0002-8282
- Publication type
Article