Decoupling at the Margin: The Threat to Monetary Policy from the Electronic Revolution in Banking / Benjamin M. Friedman.

Format:

Book

Author/Creator:

Friedman, Benjamin M.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w7955.

NBER working paper series no. w7955

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Decoupling at the Margin

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2000.

Summary:

The threat to monetary policy from the electronic revolution in banking is the possibility of a decoupling' of the operations of the central bank from markets in which financial claims are created and transacted in ways that, at some operative margin, affect the decisions of households and firms on such matters as how much to spend (and on what), how much (and what) to produce, and what to pay or charge for ordinary goods and services. The object of this paper is to discuss how this possibility arises and what it implies, to dismiss as unessential to the argument various extreme characterizations that have arisen in the recent debate on this issue (for example, that no one will use money for ordinary economic transactions), and to address the specific arguments on the issue offered by Charles Goodhart, Charles Freedman and Michael Woodford.

Notes:

Print version record

October 2000.