Journal of Money, Credit & Banking

Reports major findings in the study of financial institutions, financial markets, monetary and fiscal policy, credit markets, money and banking.

Articles from Vol. 37, No. 2, April

Assessing the Lucas Critique in Monetary Policy Models
LUCAS (1976) ARGUES that the parameters of traditional macroeconometric models depend implicitly on agents' expectations of the policy process and are unlikely to remain stable as policymakers change their behavior. Historically, this critique was...
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Courts and Banks: Effects of Judicial Enforcement on Credit Markets
May you have lawsuits--and win them.--Old gypsy curse (1) A BORROWER MAY default on a loan because he is unable (accidental default) or because, though potentially solvent, he is unwilling to repay (strategic default). Besides being intrinsically...
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Credit Scoring and the Availability, Price, and Risk of Small Business Credit
ADVANCES IN INFORMATION processing, telecommunications, and financial engineering have helped transform the U.S. commercial banking industry in recent years. This paper focuses on one rapidly spreading technology that embodies these advances--small...
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Deregulation, Intensity of Competition, Industry Evolution, and the Productivity Growth of U.S. Commercial Banks
VARIOUS INTRASTATE AND interstate banking restrictions confined U.S. commercial banks to operate within a well- and narrowly defined geographic area and/or obstructed their expansion beyond that area for much of the 20th century. Critics of these regulatory...
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Does Labor's Share Drive Inflation?
RECENT YEARS have seen an explosion in research aimed at assessing monetary policy rules using macroeconomic models built from explicit microfoundations. In many versions of these models, pricing behavior is described by a "new-Keynesian Phillips curve,"...
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Microfoundations of Macroeconomic Price Adjustment: Survey Evidence from Swedish Firms
The sensitivity of prices to monetary and other shocks plays a crucial role in how these shocks impact the macroeconomy. The micro evidence on price adjustment that can be used to guide our thinking in this regard is remarkably limited, however (see...
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Openness, Central Bank Independence, and the Sacrifice Ratio
HOMER (1993) FOUND a negative relationship between openness and trend inflation. To explain this relationship, Homer appealed to the basic Barro and Gordon (1983) time-inconsistency model of discretionary monetary policy, arguing that greater openness...
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Real Implications of the Zero Bound on Nominal Interest Rates
AT LEAST since the writings of Irving Fisher, economists have understood that nominal interest rates are bounded below by some number close to zero. No one would willingly hold a security, payable in money, which yielded a return below the storage...
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State of the Art Unit Root Tests and Purchasing Power Parity
THE QUESTION OV whether Purchasing Power Parity (PPP) holds in the long run has been the subject of voluminous research. Some of the strongest evidence of long-run PPP is provided by Taylor (2002). An important contribution of Taylor's work is to construct...
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