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1982 Working Papers

  • WP 82-03 | A Micro View of the Money Transactions Market


    Mark Zupan

    Abstract

    This paper provides a micro-oriented, price-theoretic perspective on the transactions money market. Such a perspective is useful for three reasons. First, it emphasizes that the supply of transactions money will depend on, among other things, the state of technology in the transactions-money producing industry, the price of transactions money, the cost of factors of production utilized to manufacture transactions money, and the prices of substitutes for and complements of transactions money--types of determinants that are commonly taken into account in the specification of a supply curve of commodities other than transactions money but have been given either little attention or ignored in the case of transactions money. Second, a micro perspective can also deal with the fact that transactions money is not a homogeneous good--provided that the costs of transforming/transporting the different money forms to a homogeneous state are specifiable (the divisia approach to monetary aggregation notably takes a percentage transformation/ transportation cost approach). Read More

  • WP 82-02 | Stability in a Model of Staggered-Reserve Accounting


    Michael Bagshaw William Gavin

    Abstract

    Critics of staggered-reserve accounting have used simple models to show that a disturbance to deposits with no change in total reserves sets in motion an undamped cycle in which deposits oscillate above and below the equilibrium implied by the total reserve target. In this paper a simple reduced-form model of the money-supply process is used to investigate the nature of the dynamic process implied by staggered-reserve accounting. The parameters in the model include the number of banking groups in the staggered regime, the reserve requirement, the response of banks to their own reserve position, and the response of banks to a deviation of the money supply from target. Read More

  • WP 82-01 | Multibank Holding Company Organizational Structure and Performance


    Gary Whalen

    Abstract

    Over the past decade, several researchers have suggested that multibank holding company organizational structure will systematically influence the performance of subsidiary banks. Specifically, these researchers have hypothesized that the magnitude of affiliation benefits generated by a particular holding company will be positively related to the degree to which control over subsidiary bank decisions and operations is centralized in the hands of the parent corporation. To date, this possibility has been ignored in the empirical studies exploring holding company affiliation impacts, perhaps biasing their results. To obtain insight on this issue, quantitative measures of the organizational centralization of 62 multibank holding companies, derived from survey data, were related to summary measures of holding company profitability. A positive, significant relationship was discovered between these centralization indexes and holding company profitability Read More