THE ROLE OF MONEY AND CREDIT ON BUSINESS CYCLES

Year 1992, Volume: 10 Issue: 1, 45 - 54, 31.12.1992

Kemal Yıldırım

Abstract

This study is basically constructed on four articles which represent an overview of a particular school of thought about business cycles and the role which money andıor eredit play in these cycles. The artides are:
1- B.S. Bernanke (1983), «Nonmonetary Effects of the Finarıcial erisis in the Propagation of the Great Depression».
2" J.B. Long anel C. Plosser (1983), «Real Business Cycles».
3- R. Lucas (1977), «Understanding Business Cycles».
4- A. Wojnilower (1980), «The Central Role of Credit Crunches in Reccnt Financial History».

For each reading, first we tried to summarize the approaeh takeri to modelling business cycles paying particnlar attention to: i) The origin of business cycles (the impulse mechanism), ii) The way in which business cycles are generateel over time (the propagation mechanism), iii) The role of morıey and ereelit markets in the cyclical process.
Therı tried tıo compare and contrast the approach to the modelling of business cycles taken in:
A-Reaıding 2 compared to that in reading 3,
B-Reading 1 cornpared to that in reading 4.

Keywords

money, business

References

• BERNANKE, Ben S. : «Nonmorıetary Effects of the Financial Crisis in the Propagation of the Great Depression», The American Economic Review, V.73, N.3, June 1983.
• LONG, Jhon B. and C. Plosser : «Real Business Cycles», Journal of Political Economy, February 1983.
• LUCAS, Robert E.: «Urıderstanding Business Cycles», In CarnegieRochester Conference Series on Public Policy 5. 1977.
• WOJNILOWER, Albert M.: «The Central Role of Credit Crunches in Recent Financial History», Brookings Papers on Economic Activity, 2. 1980.