Journal article
THE BROAD CONSEQUENCES OF NARROW BANKING
Abstract
We investigate the macroeconomic consequences of narrow banking in the context of stock-flow consistent models. We begin with an extension of the Goodwin–Keen model incorporating time deposits, government bills, cash, and central bank reserves to the base model with loans and demand deposits, and use it to describe a fractional reserve banking system. We then characterize narrow banking by a full reserve requirement on demand deposits and …
Authors
GRASSELLI MR; LIPTON A
Journal
International Journal of Theoretical and Applied Finance, Vol. 22, No. 01,
Publisher
World Scientific Publishing
Publication Date
2 2019
DOI
10.1142/s0219024919500079
ISSN
0219-0249