伯南克宏观经济学 Chapter 7.pptVIP

The Demand for Money Elasticities of money demand Income elasticity of money demand Interest elasticity of money demand Price elasticity of money demand is unitary, so money demand is proportional to the price level * Summary 9 * The Demand for Money Velocity and the quantity theory of money Velocity V measures how much money “turns over” each period V nominal GDP / nominal money stock PY / M 7.4 Plot of velocities for M1 and M2 Figure 7.1 shows fairly stable velocity for M2, erratic velocity for M1 beginning in early 1980s * Figure 7.1 Velocity of M1 and M2, 1959-2005 * The Demand for Money Velocity and the quantity theory of money Quantity theory of money: Real money demand is proportional to real income If so, Md / P kY 7.5 Assumes constant velocity, where velocity isn’t affected by income or interest rates * Asset Market Equilibrium Asset market equilibrium—an aggregation assumption Assume that all assets can be grouped into two categories, money and nonmonetary assets Money includes currency and checking accounts Pays interest rate im Supply is fixed at M Nonmonetary assets include stocks, bonds, land, etc. Pays interest rate i r + πe Supply is fixed at NM * Asset Market Equilibrium Asset market equilibrium occurs when quantity of money supplied equals quantity of money demanded md + nmd total nominal wealth of an individual Md + NMd aggregate nominal wealth 7.6 M + NM aggregate nominal wealth 7.7 Subtracting Eq. 7.7 from Eq. 7.6 gives Md – M + NMd – NM 0 7.8 * Asset Market Equilibrium So excess demand for money Md – M plus excess demand for nonmonetary assets NMd – NM equals 0 So if money supply equals money demand, nonmonetary asset supply must equal nonmonetary asset demand; then entire asset market is in equilibrium * Asset Market Equilibrium The asset market equilibrium condition M / P L Y, r + πe 7.9 real money supply real money demand M is determined by the central bank πe is fixed for now The labor marke