MONEY AND FINANCIAL STABILITY PAPERS
"The financial instability hypothesis", Minsky
1) What is the economic problem?
2) What are the three types of financial structures?
3) Big government may be good but also bad, why?
4) What are the two theorems of the financial instability hypothesis?
5) Does the FIH rely on external shock to generate instability?
"On the non-neutrality of money" Minsky
1) Each theory uses special concepts to derive a conclusion regarding the neutrality or non-neutrality of money. In Minsky theory, what are the concepts that replace: rational expectation? Asymmetry of information? Aggregation of individual agents? Independence of real and monetary variables?
2) What is the main consequence of 1- regarding the neutrality of money: can money ever be neutral? Explain.
3) What are the three types of financial structures used to measure financial fragility?
4) Can banks be in a hedge finance position? Explain.
5) What is the meaning of 'robustness'?
6) Why is the capitalist economic system inherently unstable?
7) Why does a free market economy require a big government?