Can Financial Innovation Help to Explain the Reduced Volatility of Economic Activity?
- Topics:
- Financial Statements,
- Investment Strategy
- Tags:
- Economic Activity,
- Strategy,
- Management,
- Leadership,
- Innovation,
- Financial Accounting,
- Financial,
- Finance,
- Federal Reserve Board,
- Volatility
- Source:
- Federal Reserve Board
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Overview: The stabilization of economic activity in the mid 1980s has received considerable attention. Research has focused primarily on the role played by milder economic shocks, improved inventory management, and better monetary policy. This paper explores another potential explanation: financial innovation. Examples of such innovation include developments in lending practices and loan markets that have enhanced the ability of households and firms to borrow and changes in government policy such as the demise of Regulation Q.
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Format: PDF | Size: 414KB | Date: Nov 2005 | Pages: 55





