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HORIZONTALISM, STRUCTURALISM, LIQUIDITY PREFERENCE AND THE PRINCIPLE OF INCREASING RISK
Author(s) -
Lavoie Marc
Publication year - 1996
Publication title -
scottish journal of political economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.4
H-Index - 46
eISSN - 1467-9485
pISSN - 0036-9292
DOI - 10.1111/j.1467-9485.1996.tb00846.x
Subject(s) - liquidity preference , economics , endogeneity , preference , market liquidity , keynesian economics , new keynesian economics , monetary economics , structuralism (philosophy of science) , liquidity trap , liquidity risk , monetary policy , econometrics , microeconomics , philosophy , epistemology
A bstract It is shown that the horizontal post‐Keynesian view of credit‐money endogeneity is reasonable rather than extreme. One can argue in favour of a horizontal credit‐money supply curve while still taking into account the non‐accommodating behaviour of the central bank, financial innovations, protfolio adjustments, liquidity perference theory, and the principle of increasing risk. The differences between horizontalists and other post‐Keynesian monetary theorists are matters of emphasis rather than substantial differences of opinion. The only real topic of contention is the ultimate determinant of the base rate of interest.