Lessons from Asset-Based Financial Systems with Zero-Reserve Requirements

  • Marc Lavoie


Although Augusto Graziani has devoted a large number of his works to the notion of endogenous money, there is little to be found about the behaviour of the central bank. This in itself is not surprising, since most writers of the circuit school have paid no attention to the role of central banks. Most analyses of the monetary circuit are set within a kind of pure Wicksellian economy, closed and without a government. The links between commercial banks and the central bank, as well as the interdependence between the decisions of the central bank and the non-financial sectors, are thus left aside.


Monetary Policy Central Bank Reserve Requirement Federal Fund Rate Monetary Base 
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© Marc Lavoie 2005

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  • Marc Lavoie

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