Abstract
The paper studies the stability and the non-neutrality of money issues of the neoclassical monetary growth theory when the liquidity preference function and the price dynamics equation are generalized in the Tobin model. Our generalization introduces Tobin's real purchasing power into the liquidity preference function, thereby allowing real balance flows to exert direct income effects. Such effects allow a number of separate cases in the price dynamics behavior, some of which lead to results that differ from the neoclassical propositions. Thus, these propositions are sensitive to the choice of a particular proxy measure of the transactions motives of the demand for money.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
