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. 40, No. 1, February

Can Interest-Bearing Money Circulate? A Small-Denomination Arkansan Experiment, 1861-63
The Treasurer has succeeded in procuring plates for striking off [interest-bearing] treasury warrants of the denominations of one, two, three, five and ten dollars. These will resemble a bank bill.... We apprehend that they will come into...
Consumers' Use of Debit Cards: Patterns, Preferences, and Price Response
ANNUAL DEBIT CARD transactions at the point of sale have been growing at over 20% per year since 1996 and now exceed credit card transactions. (1) In sharp contrast, the volume of checks has decreased dramatically since the mid-1990's and is currently...
Emergence of Captive Finance Companies and Risk Segmentation in Loan Markets: Theory and Evidence
THIS PAPER PRESENTS a theoretical model and empirical evidence of risk segmentation of the secured consumer installment loan market by two different types of lending institutions--independent lending institutions and captive finance companies. A consumer...
Inflation and Welfare: A Search Approach
ASSESSING THE WELFARE costs of inflation requires a sound understanding of the benefits of monetary exchange. The search theory of money, developed in the last 15 years from the pioneering works of Kiyotaki and Wright (1989, 1993), offers such a framework....
Information Contagion and Bank Herding
IN THIS PAPER, we show that the likelihood of information contagion can induce even profit-maximizing bank owners to herd with other banks. Banks have an incentive to herd so as to minimize the information spillover from bad news about other banks...
Money Market Integration
WHETHER THE MARKETS for federal funds and Eurodollars--the two core components of the dollar money market--are well integrated is an issue relevant for both financial analysis and the execution of monetary policy. From the viewpoint of the former,...
Relationship Lending, Accounting Disclosure, and Credit Availability during the Asian Financial Crisis
THE RESEARCH ON bank relationships argues that establishing a lending relationship with a bank can reduce asymmetries of information and create value for the borrower. This value can take either of two forms: one form is reduced interest rates for...
The Effect of Bank Credit on Asset Prices: Evidence from the Japanese Real Estate Boom during the 1980s
THE PURPOSE OF THIS paper is to determine whether bank credit affects asset prices. The Japanese real estate boom during the 1980s provides a unique episode to help answer this question. In particular, this paper studies the extent to which an exogenous...
The "Great Moderation" in the United Kingdom
ON OCTOBER 8, 1992, 3 weeks after sterling's departure from the Exchange Rate Mechanism of the European Monetary System, the Chancellor of the Exchequer, Norman Lamont, established the first direct inflation target in the history of the United Kingdom,...
The Liquidity Effect in the Federal Funds Market: Evidence at the Monthly Frequency
ECONOMISTS OFTEN CONSIDER the first step in the transmission mechanism of monetary policy to be a shift in the "money supply" that changes interest rates. Some authors (e.g., Reichenstein 1987, Leeper and Gordon 1992) have failed to find a negative...