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Money, Imperfect Information and Economic Fluctuations / Bruce Greenwald, Joseph E. Stiglitz.
- Format:
- Book
- Author/Creator:
- Greenwald, Bruce.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w2188.
- NBER working paper series no. w2188
- Language:
- English
- Subjects (All):
- Business cycles.
- Capital market.
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1987.
- Cambridge, Massachusetts : National Bureau of Economic Research, 1987.
- Summary:
- This paper summarizes the macro-economic and, in particular, monetary and financial market implications of recent developments in the micro-economic theory of imperfect information. These micro-economic models which lead to credit-rationing on the one hand and limitations in the availability of equity type financing on the other can account for a wide range of observed business cycle and monetary phenomena. These include (a) unemployment, (b) the existence of Keynesian-type multiples, (c) the observed lack of production smoothing in response to cyclical fluctuations in demand, (d) the impact of monetary policy on business activity despite the absence of significant changes in real interest rates, and (e) price rigidities which arise from rational firm decisions (not as an a priori assumption).
- Notes:
- Print version record
- March 1987.
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