Abstract
This chapter places money within the context of a basic model of the macro economy. It begins by outlining the classical quantity theory and goes on to develop the IS/LM paradigm which replaced it as the basic organising framework. Emphasis is placed on the financial aspects of the IS/LM model, and there is an introduction to the ‘crowding-out’ debate. The main weaknesses of this approach are also considered. Finally, the external side of the economy is added to this simple framework in order to see how this affects the money supply, and the policy options, and operations, of the central authorities.
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© 1980 Richard Coghlan
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Coghlan, R. (1980). Money in Macroeconomic Models. In: The Theory of Money and Finance. Palgrave, London. https://doi.org/10.1007/978-1-349-86121-7_2
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DOI: https://doi.org/10.1007/978-1-349-86121-7_2
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