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On the Bottom-up Foundations of the Banking-Macro Nexus

Wäckerle, Manuel (2013) On the Bottom-up Foundations of the Banking-Macro Nexus. Economics: The Open-Access, Open-Assessment E-Journal, 7 (2013-40). pp. 1-45. ISSN 1864-6042

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Abstract

The complexity of credit-money is conceived as the central issue in the banking-macro nexus, which the author considers as a structural as well as process component of the evolving economy. This nexus is significant for the stability as well as the fragility of the economic system, because it connects the monetary with the real domain of economic production and consumption. The evolution of credit rules shapes economic networks between households, firms, banks, governments and central banks in space and time. The properties and characteristics of this evolutionary process are discussed in three sections. First, the author looks into the origins of the theory of money and its role for contemporary monetary economics. Second, he briefly discusses current theoretical foundations of top-down as well as bottom-up approaches to the banking-macro nexus, such as dynamic stochastic general equilibrium and agent-based models. In the third part he suggests an evolutionary framework, building on a generic rule-based approach, to arrive at standards for bottom-up foundations in agent-based macroeconomic models with a banking sector. (author's abstract)

Item Type: Article
Additional Information: The author would like to highlight that this work was performed during research projects granted by the Oesterreichische Nationalbank (OeNB - the central bank of the Republic of Austria) within the 'Jubiläumsfonds' projects 13350 and 14261. Additionally, he would like to particularly thank Dirk Bezemer and Willi Semmler (COST Action IS09202 conference 2011, Paris); Marc Lavoie, Miriam Rehm and Armon Rezai (Arbeiterkammer Wien-Workshop 2012); Marco Raberto and Silvano Cincotti (MAFIN 2012 workshop, Genoa); as well as all the other helpful participants of these conferences and workshops; Heinz Handler and Fritz Breuss (OeNB project 14261); and two anonymous referees for highly useful comments. Finally, the author would like to acknowledge the efforts of Georg Blind, Kurt Dopfer, Hardy Hanappi and Bernhard Rengs for discussions on early versions of this paper.
Keywords: twentieth-century origins of the theory of money / credit-driven innovation / endogenous money / top-down versus bottom-up / credit supply and demand rules / institutional approach / evolutionary macroeconomics
Classification Codes: JEL E02; B25; B52; E41; E51; G21; C63
Divisions: Departments > Sozioökonomie > Multi-Level Governance and Development
Version of the Document: Published
Variance from Published Version: None
Depositing User: Elena Simukovic
Date Deposited: 26 Apr 2016 12:15
Last Modified: 26 Apr 2016 15:34
Related URLs:
FIDES Link: https://bach.wu.ac.at/d/research/results/64450/
URI: http://epub.wu.ac.at/id/eprint/5017

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