Monetary Equilibrium and Price Stickiness: A Rejoinder Report as inadecuate




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Abstract

Luther and Salter argue for a regime where aggregate demand is restored by an increase in the money supply in response to an increase in the demand for money. They claim that, 1 monetary equilibrium policy prescriptions do not necessarily rely on sticky prices, 2 Cantillon effects can be neglected without consequence, 3 wealth redistributions from monetary policy are unimportant, 4 monetary disequilibrium theorists strive for a stable price level, 5 fewer price adjustments are necessary in their proposed regime, 6 savings and saving are equivalent, 7 changes in the composition of savings do not alter time preference, and, 8 in the proposed regime economic calculation is easier than in a 100 percent reserve system . All these claims are false. They furthermore misconstrue us as preferring negative quantity adjustments to positive price adjustments. This too is false.



Item Type: MPRA Paper -

Original Title: Monetary Equilibrium and Price Stickiness: A Rejoinder-

Language: English-

Keywords: sticky prices; non-neutral money; monetary equilibrium; free banking-

Subjects: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary PolicyE - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies-





Author: Bagus, Philipp

Source: https://mpra.ub.uni-muenchen.de/79597/







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