Monetary theory /
Vijay Kumar Ari, Randheer Singh Bhinchar.
- New Delhi : Random Publications, 2021.
- 309 pages : illustrations ; 24 cm
Includes bibliographical references and index.
Introduction -- Theory in Monetary Policy -- Money and Credit -- Investment -- International Monetary Fund -- Money Supply and Demand -- Currency Areas, Exchange Rate Systems and International Monetary Reform -- Monetary Standards of Money -- Role of Banking System in the Economy.
"The primary tool of monetary policy is open market operations. This entails managing the quantity of money in circulation through the buying and selling of various credit instruments, foreign currencies or commodities. All of these purchases or sales result in more or less base currency entering or leaving market circulation. Monetary theory is based on the idea that a change in money supply is the main driver of economic activity. It argues that central banks, which control the levers of monetary policy, can exert much power over economic growth rates by tinkering with the amount of currency and other liquid instruments circulating in a country's economy. Developing countries may have problems establishing an effective operating monetary policy. The primary difficulty is that few developing countries have deep markets in government debt. The matter is further complicated by the difficulties in forecasting money demand and fiscal pressure to levy the inflation tax by expanding the monetary base rapidly. In general, the central banks in many developing countries have poor records in managing monetary policy. This book, written as an introductory manual, has been conceptualised and written as a book which challenges, as well as defines, much of what entails, contemporary monetary economic."--Back cover