Italian Household Demand: Monetary Assets and Government Debt

International Monetary Fund

No 1988/076, IMF Working Papers from International Monetary Fund

Abstract: The composition of Italian household wealth has undergone significant changes in the last decade, partly reflecting the growth of public debt and monetary policies aimed at encouraging its absorption by the household sector. Within a theoretical framework consistent with the “money in the utility function” approach, this paper investigates household preferences for liquidity services provided by short-term financial assets. In the attempt to explain the factors underlying those changes, the empirical analysis provides information on the pattern of substitution for the main components of financial wealth and permits analysis of a variety of government interventions in asset markets.

Keywords: WP; utility function; opportunity cost; inflation rate; treasury credit certificate; consumer durables; asset substitution; Government securities; Inflation; Bank deposits; Liquidity (search for similar items in EconPapers)
Pages: 32
Date: 1988-01-01
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