In 1983, Ben Bernanke published an interesting article in which he proposed that the real service that banks perform is the development of long-term working relationships, which give them the informational wherewithal to allocate capital efficiently.
Bernanke, Ben S. 1983. "Nonmonetary Effects of the Financial Crisis in the Propagation of the Great Depression" American Economic Review, 73: 3 (June): pp. 257-76. He elaborated on this idea in: Bernanke, Ben. 1993. "Credit in the Macroeconomy." Federal Reserve Bank of New York Quarterly Review, 18: 1 (Spring): pp. 50-70. more at: http://michaelperelman.wordpress.com/2010/07/10/young-ben-bernanke-economist/ -- Michael Perelman Economics Department California State University Chico, CA 95929 530 898 5321 fax 530 898 5901 http://michaelperelman.wordpress.com _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
