清华大学货币银行学讲义（考研必备）Ch4.pptVIP

Ch4. money supply: model technique What will you learn in this part： How changes in the money supply (MS) are reflected in commercial bank’s and central bank balance sheets How to analyses changes in the money supply through the monetary base and flow of funds models of money supply determination Endogenous and exogenous of money supply The controlling techniques of monetary authority for the MS 4.1 balance sheet of bank, deposit reserves, mandatory reserve ratio 4.1.1 the balance sheet of commercial central banks Does shortcomings leave the monetary base multiplier model? Multiplier approach places the portfolio decision of banks within a straitjacket. Bank reserves automatically back private sector lending, for which there is an assumed ready demand, interest rates playing no role, hence the portfolio approach is not considered. Demand for cash may also negatively related to interest rates. This could be analyzed in manner analogous to the inventory-theoretic approach ( Baumol 1952) . It is clearly an oversimplification to see the money supply process as a constant causal relation from monetary base to money stock. Not only is the value of multiplier likely to change, but the process of monetary expansion is likely to feed back on the supply of the monetary base itself. (ex: increase finance of the public sector deficit) （1）flow of funds model focuses upon flow; the BMM focuses upon stocks （2）flow of funds model does not include any transactions between the banking system and the monetary authorities. BMM may imply that the controlling money supply requires either that the authorities control the quantity demand for loan or that they control banks’ ability to respond to the demand. （3）flow of funds model includes bank lending to the private sector, it focuses upon the demand for credit by both the public and private sectors. Given the many different ways in which both the public and private sectors can borrow, it follows that there many loan-related f