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| List of Figures | |
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| List of Tables | |
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| List of Case Studies | |
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| Preface | |
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| Introduction | |
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| An Introduction to Finance and Macroeconomics | |
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| The Basics of Financial Markets and Financial Institutions | |
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| Introduction | |
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| What is Financial Intermediation and Why is It Different from Other Economic Transactions? | |
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| What is Money? | |
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| The Importance of Financial Systems in Stimulating Long-Run Growth | |
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| The Empirical Evidence on Financial Development and Growth | |
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| The Four Primary Forms of Financial Intermediation | |
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| Conclusions | |
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| A Brief History of Financial Development | |
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| Introduction | |
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| A Brief History of Banking, Financial Markets, and Central Banking | |
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| Modern Central Banking | |
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| A Brief History of International Capital Flows | |
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| Globalization and Financial Development in the 1990s | |
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| Conclusions | |
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| Macroeconomic Theory and the Role of Finance | |
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| Business Cycles and Early Macroeconomic Theories of Finance | |
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| Introduction | |
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| Business Cycle Definitions | |
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| Financial Indicators of Business Cycles | |
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| The Sunspot Theory | |
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| Early Monetary Theories | |
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| The Classical Model | |
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| The Debt-Deflation Theory | |
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| Conclusions | |
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| Keynesian, Monetarist, and Neoclassical Theories | |
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| Introduction | |
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| Keynes' General Theory | |
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| Keynesian Economics and the IS-LM Model | |
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| The Financial Instability Hypothesis | |
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| The Monetarist Model | |
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| Principles of the Monetarist model | |
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| Neoclassical Theories | |
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| Conclusions | |
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| New Institutional Theories of Finance: Models of Risk and the Costs of Credit Intermediation | |
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| Introduction | |
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| What is Meant by "New Institutional" Theories of Finance? | |
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| The Financial Accelerator Model and the Role of Credit in Business Cycles | |
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| The Financial Accelerator and Monetary Policy | |
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| The Empirical Evidence on the Financial Accelerator Model | |
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| Conclusions | |
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| New Institutional Theories of Finance: Models of Credit Rationing | |
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| Introduction | |
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| Two Models of Credit Rationing | |
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| Equity Rationing | |
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| Empirical Evidence on Models of Credit Rationing | |
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| Conclusions | |
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| Financial Volatility and Economic [In]stability | |
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| The Role of Financial Systems in Monetary and Stabilization Policy | |
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| Introduction | |
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| Why Does Money Matter? Traditional Theories of the Monetary Transmission Mechanism | |
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| Balance Sheet Channels and the Monetary Transmission Mechanism | |
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| Empirical Studies of the Balance Sheet Channels of Monetary Transmission | |
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| Is Monetary Policy Still Powerful? A Look at the Empirical Evidence | |
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| Old Debates over the Effectiveness of Stabilization Policy | |
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| New Debates over the Effectiveness of Stabilization Policy | |
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| Conclusions | |
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| Banking Crises and Asset Bubbles | |
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| Introduction | |
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| The Causes and Prevention of Banking Crises | |
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| Empirical Evidence on Banking Crises | |
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| The Causes and Prevention of Asset Bubbles | |
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| Empirical Evidence on Asset Bubbles | |
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| Conclusions | |
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| International Finance and Financial Crises | |
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| Capital Flight and the Causes of International Financial Crises | |
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| Introduction | |
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| The Causes of Capital Flight and Currency Crises | |
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| Contagion | |
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| Empirical Evidence on Capital Flows, Currency Crises, and Contagion | |
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| The Causes and Costs of Twin Crises | |
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| The Currency and Banking Crises in East Asia | |
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| Conclusions | |
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| International Financial Crises: Policies and Prevention | |
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| Introduction | |
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| The Benefits and Costs of Financial Liberalization | |
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| Guidelines for Domestic Financial Regulation | |
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| The Pros and Cons of Capital Controls | |
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| International Financial Regulation | |
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| The IMF, Its Policies, and Its Critics | |
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| Reforming the IMF | |
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| Conclusions | |
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| Conclusions | |
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| What We have Learned, What We Still Need to Learn about Financial Macroeconomics | |
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| A Brief Review | |
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| What We Have Learned about Financial Macroeconomics | |
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| What We Do Not Know | |
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| Concluding Conclusions | |
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| Bibliography | |
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| Index | |