liquidity preference


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Related to liquidity preference: Market segmentation theory

liquidity preference

n
(Economics) economics the desire to hold money rather than other assets, in Keynsian theory based on motives of transactions, precaution, and speculation
References in periodicals archive ?
More specifically, Keynes did not understand that the pure liquidity preference theory is flawed.
The first chapter consists of brief background on issues related to oligopoly, liquidity preference, stochastic equilibrium models, domestic benchmark rate, financial programming, the compensation principle, monetary transmission, exchange rate stability, endogenous money, and non-contestability.
For companies with a strong liquidity preference, a lease can provide significant benefit in the preservation of working capital and cash flow management.
The first rejects Keynes' theories of liquidity preference, the second reinstates them while for the Circuitists the Central Bank's issue of 'high-powered money' is the critical mechanism in regulating liquidity (p76).
Liquidity preference is the key to coordination failures that can generate unemployment.
A sampling of topics: inflation and unemployment, liquidity preference as behavior towards risk, liquidity preference and the theory of interest and money, long-run implications of alternative fiscal policies and the burden of the national debt, investment under uncertainty, hours and employment variation in business cycle theory, and the inconsistency of optimal plans.
This is due to high liquidity preference of domestic banks, strong growth in UAH deposits and ongoing deleveraging of credit portfolios.
Given the liquidity preference for high-growth assets, any major market correction will be limited.
Unconventional monetary policies have led to a large overhang of liquidity--indeed, their aim w as partly to respond to increased liquidity preference and to ensure that the stability of financial institutions would not be threatened by lack of liquidity.
He researches the four key theories of money demand--The Quantity Theory of Money, Keynes's Liquidity Preference Theory, Friedman's Modern Quantity Theory of Money, and the Baumol-Tobin Model--and comes up with a list of questions applying the impacts of credit cards and debit cards to the results of the models.
In terms of theory, Keynes breaks with tradition and replaces the 'classical' theories of the rate of interest with the liquidity preference theory.