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Monetary Policy

John Fender

ISBN: 978-0-470-01909-2 March 2012 246 Pages


Designed for advanced undergraduates in economics, this new text provides an up-to-date analysis of the practice and theory of monetary policy and discusses key models that tie in with contemporary research and policy.

The transmission mechanism of monetary policy is given particular emphasis and the book discusses the behaviour of a number of central banks, in particular the Bank of England, the European Central Bank and the Federal Reserve. The worldwide credit crunch and subsequent recession and non-conventional monetary policies such as quantitative easing are also given extensive treatment. 

There are also chapters on a wide variety of topics such as: Consumption, investment, money demand and money supply, nominal rigidities, inflation and unemployment, time Inconsistency and central bank independence, the social costs of inflation, the role of financial intermediaries, monetary policy in an open economy, the term structure of interest rates, the stock market, the housing market and fiscal policy.

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Chapter 1. Foundations of a Monetary Economy

Chapter 2. Keynes, IS-LM and After

Chapter 3. Consumption

Chapter 4. Investment

Chapter 5. Money Demand and Money Supply

Chapter 6. Nominal Rigidities

Chapter 7. Inflation and Unemployment

Chapter 8. Time Inconsistency: Theoretical Foundations for Independent Central Banks?

Chapter 9. The Social Costs of Inflation

Chapter 10. Financial Intermediaries, Credit Market Imperfections and their Relevance for Monetary Policy

Chapter 11. Monetary Policy in an Open Economy

Chapter 12. The Term Structure of Interest Rates

Chapter 13. The Stock Market

Chapter 14. The Housing Market

Chapter 15. Fiscal Policy

Chapter 16. Evidence on the Effectiveness of Monetary Policy

Chapter 17. The Targets and Instruments of Monetary Policy

Chapter 18. The Transmission Mechanism. How does the Central Bank Influence the Behaviour of the Economy?

Chapter 19. Monetary Policy in Practice

Chapter 20. The Worldwide Credit Crunch and Recession of 2007-9

Chapter 21. Recent Innovations in Monetary Policy: Quantitative Easing

Chapter 22. Monetary Policy Now and in the Future




  • Reflects the modern approach to teaching monetary economics
  • Provides a clear exposition on key models and issues in a way that ties in effectively with ongoing research and policy
  • An up-to-date text that meets the needs of advanced undergraduate students
  • John Fender is a highly respected academic with an extensive record of journal publications on monetary policy