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The long-run demand for money : a Wicksellian approach

Jonung, Lars LU (1979) In The Theoretical Contributions of Knut Wicksell p.88-102
Abstract
The income velocity of money in several countries such as Sweden, the United States and Great Britain, displays a U-shaped pattern for the last one hundred years. This paper proposes an explanation of this secular behavior based on an extension of Wicksell’s work on velocity emphasizing the influence of institutional changes. The secular fall in velocity in the last half of the 19th century and the first part of the 20th century is regarded as the outcome of a process of monetization encompassing (1) a growing use of money at the expense of a decline in barter and payment in kind, and (2) an increase in the activity of commercial banks with respect to supplying notes and bank deposits to the public. The secular rise in velocity is viewed... (More)
The income velocity of money in several countries such as Sweden, the United States and Great Britain, displays a U-shaped pattern for the last one hundred years. This paper proposes an explanation of this secular behavior based on an extension of Wicksell’s work on velocity emphasizing the influence of institutional changes. The secular fall in velocity in the last half of the 19th century and the first part of the 20th century is regarded as the outcome of a process of monetization encompassing (1) a growing use of money at the expense of a decline in barter and payment in kind, and (2) an increase in the activity of commercial banks with respect to supplying notes and bank deposits to the public. The secular rise in velocity is viewed as the result of two developments, increasing financial sophistication and growing economic security and stability. The explanation suggested here is confronted with some relevant empirical evidence. The paper, being exploratory in character, deals primarily with the Swedish record. (Less)
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author
organization
publishing date
type
Chapter in Book/Report/Conference proceeding
publication status
published
subject
in
The Theoretical Contributions of Knut Wicksell
editor
Strøm, Steinar; Thalberg, Björn; and
pages
15 pages
publisher
Palgrave Macmillan Ltd.
external identifiers
  • scopus:85006632111
ISBN
978-1-349-04207-4
978-1-349-04209-8
DOI
10.1007/978-1-349-04207-4_10
language
English
LU publication?
yes
id
a691e96b-cf62-4dc9-8c6f-0917c3aebb5b
alternative location
https://www.scopus.com/inward/record.uri?eid=2-s2.0-85006632111&doi=10.1007%2f978-1-349-04207-4&partnerID=40&md5=ca1367a2697b6f7197e288724a19908c
date added to LUP
2017-02-20 11:58:08
date last changed
2017-03-12 04:40:30
@inbook{a691e96b-cf62-4dc9-8c6f-0917c3aebb5b,
  abstract     = {The income velocity of money in several countries such as Sweden, the United States and Great Britain, displays a U-shaped pattern for the last one hundred years. This paper proposes an explanation of this secular behavior based on an extension of Wicksell’s work on velocity emphasizing the influence of institutional changes. The secular fall in velocity in the last half of the 19th century and the first part of the 20th century is regarded as the outcome of a process of monetization encompassing (1) a growing use of money at the expense of a decline in barter and payment in kind, and (2) an increase in the activity of commercial banks with respect to supplying notes and bank deposits to the public. The secular rise in velocity is viewed as the result of two developments, increasing financial sophistication and growing economic security and stability. The explanation suggested here is confronted with some relevant empirical evidence. The paper, being exploratory in character, deals primarily with the Swedish record.},
  author       = {Jonung, Lars},
  editor       = {Strøm, Steinar and Thalberg, Björn},
  isbn         = {978-1-349-04207-4},
  language     = {eng},
  pages        = {88--102},
  publisher    = {Palgrave Macmillan Ltd.},
  series       = {The Theoretical Contributions of Knut Wicksell},
  title        = {The long-run demand for money : a Wicksellian approach},
  url          = {http://dx.doi.org/10.1007/978-1-349-04207-4_10},
  year         = {1979},
}