The housing market-bank credit relationship: Some thoughts on its causality
The dominance of the orthodox paradigm over the last decades prior to the “great recession” left no room for the notion of “endogenous money” in the development of economic theory. However, this alternative direction of the causality of demand for money-credit and economic activity has been...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Economists' Association of Vojvodina
2014-01-01
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| Series: | Panoeconomicus |
| Subjects: | |
| Online Access: | http://www.doiserbia.nb.rs/img/doi/1452-595X/2014/1452-595X1402145A.pdf |
| Summary: | The dominance of the orthodox paradigm over the last decades prior to the
“great recession” left no room for the notion of “endogenous money” in the
development of economic theory. However, this alternative direction of the
causality of demand for money-credit and economic activity has been present
in the heterodox economic thought since the 1930s and should be reconsidered
in the current situation. In this context, the numerous episodes of housing
bubbles, which have been taking place since 2007, create the perfect
“environment” to explore the notion of “dynamic monetized production
economy”. Our theoretical framework is estimated econometrically by using a
sample of 6 developed economies which spans from 1970 to 2011. The
non-stationary “nature” of our data recommends the use of cointegration
techniques (Søren Johansen 1995) in order to estimate our models. |
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| ISSN: | 1452-595X 2217-2386 |