Premium
Savings and Loan Demand for Liquid Assets: Theory, Evidence and Implications for Policy *
Author(s) -
Weinrobe Maurice
Publication year - 1981
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.00229
Subject(s) - market liquidity , economics , loan , asset (computer security) , portfolio , variety (cybernetics) , econometrics , demand for money , monetary economics , monetary policy , microeconomics , financial economics , finance , mathematics , computer science , statistics , computer security
In this study a model of liquid asset management for individual savings and loan associations is developed. The model combines features of portfolio theory and inventory theory and is used to draw hypotheses on the relationship between the demand for excess liquidity and a variety of independent variables. Pooled cross section‐time series equations are estimated for the demand for excess liquidity of 198 S & Ls over the period 1974–1978. In addition to conclusions on the role of individual variables, the estimated equations reveal that the FHLBB can affect the portfolios of some, but not all, S & Ls. This implies that FHLBB liquidity policy can have an effect on the mortgage market.