The Monetary Transmission Mechanism

Alan Rabin and Leland Yeager
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Alan Rabin: University of Tennessee, Chattanooga
Leland Yeager: Auburn University

Eastern Economic Journal, 1997, vol. 23, issue 3, 293-299

Abstract: Several articles have recently questioned the "money view" of the monetary transmission mechanism and have offered an alternative "credit view". We argue that the money view has been incompletely presented in much of the literature and in almost all textbooks on Macroeconomics and Money and Banking. A distinction between the two views is unnecessary if one presents the money view correctly. A change in the money supply can affect income both directly and indirectly through what we call the "cash balance effect", which has other aspects than the wealth aspect that Patinkin emphasizes in discussing his "real-balance effect."

Keywords: Credit; Macroeconomics; Monetary; Money Supply; Money; Supply (search for similar items in EconPapers)
JEL-codes: E44 E51 (search for similar items in EconPapers)
Date: 1997
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eej:eeconj:v:23:y:1997:i:3:p:293-299

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