%0 Journal Article %A Brunner, Karl %A Meltzer, Allan %D 1969 %T The Relation of Money Balances to Optimal Consumption, Payments and Receipts %U https://kilthub.cmu.edu/articles/journal_contribution/The_Relation_of_Money_Balances_to_Optimal_Consumption_Payments_and_Receipts/6708713 %R 10.1184/R1/6708713.v1 %2 https://kilthub.cmu.edu/ndownloader/files/12237785 %K Business %K Management %X

One of the classical problems of economics is to explain why people hold money. The variety of attempts to derive or explain the existence of a demand for money have made the existence of a non-zero -demand depend x>n legal restrictions, -uncertainty, the expectation of price changes and many other factors. The most frequent explanation is the Keynesian explanation which makes the demand for money depend on a number of ostensibly separate Motives" for holding money. This explanation differs from its classical forebears because a variety of motives are introduced in place of the single classical motive —"the transactions motive. The Keynesian and.the classical arguments both suffer from the same defect; they fail to relate the explanation of money holding to economic theory. Holding money is not explained as the result of maximizing behavior by individuals and firms -- the ultimate money holders.

%I Carnegie Mellon University