РЕГУЛЮВАННЯ ЕКОНОМІКИ КРЕДИТНИМ МУЛЬТИПЛІКАТОРОМ

Abstract

The author asserts that the credit multiplier of the country’s banking system regulates the growth of the economy and characterizes the level of its development and prove that the limiter and indicator of economic development is the share of value added by production in the aggregate product, which determines the existing technological mode. It is proved that the ratio of nominal GDP to the monetary base of the Central Bank is identical to the product of the credit multiplier and the speed of money circulation that is constant for each technological mode. We consider the industrialized economies, developed economies, and highly developed economies. The marginal zero inflation multiplier is determined, at which real GDP growth stops and a transition to a deflationary crisis occurs. It is established that the Central Bank’s increase in the interest rate to reduce inflation leads to a sharp decrease in the multiplier and lending to production, while credit regulation allows us to reduce inflation by targeting, without changing the interest rate and without reducing lending. A model for regulating the economy with a credit multiplier has been developed using an engineering calculator and Ukraine’s economic recovery in 2024–2025 has been simulated. Keywords: economy, credit regulation, market, balance, labor, capital, money, credit multiplier, interest rate, currency, financial papers, crisis, inflation.