• 사회경제평론
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• no.38
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• pp.199-240
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• 2012

According to the Post Keynesian endogenous money theory, money is created by the bank deposit which is dependent on the banks' supply of loan. And the demand for loans is dependent on investment by firms. In the money creating process, real value(or investment) and money are connected with banks' credit. In this paper, we investigated Keynes and Post Keynesian endogenous money theory with critical reviews of Hwang (2005). We came to three conclusions. First, Post Keynesian endogenous money theory is based on Keynes' theory. Second, Keynes' endogeneity of money is essentially different from that of Wicksellian. Third, focusing on the differences of the starting point of the arguments not on the conclusions, two Post Keynesian views, namely horizontalists and structuralists are compatible with liquidity preference theory in the Keynes' system.

• The Korean Journal of Financial Management
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• v.24 no.3
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• pp.1-27
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• 2007

When banks prefer securities holding to lending, bank-dependent borrowers would be rationed in bank loan markets. This paper examines, both theoretically and empirically, the incentive of banks to hold securities rather than loans. When banks are in trouble due to an external shock and subsequent drain of deposit, they cannot reduce their loans quickly because loans are illiquid and are not easy to sell. Therefore, banks should respond to insured deposit drain by raising uninsured CDs or debentures. However, they cannot raise enough money through uninsured CDs or debentures when there is costly external finance premium. Meanwhile, if banks hold securities which are highly liquid, they can sell those securities and thus endure deposit drain without costly external financing. This explains why banks hold liquid securities of which yields to maturity are lower than those of loans. Banks' preference for securities comes from the existence of costly external finance premium, which is inversely related with bank net worth. After all, if bank net worth is kept high enough or capital market incompleteness is not severe, the preference for securities should be weakened.

• The Korean Journal of Financial Management
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• v.24 no.1
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• pp.109-147
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• 2007

According to the perspective of capital structure theory, we analyzed the dynamism of the capital structure determinants by using panel data of 244 KOSDAQ firms based on two-step GMM system methodology suggested by Blundell Bond(1998). This dynamic methodology had not been used to analyse capital structure determinants in Korea. In the dynamic model of capital structure, profit had negative effect on the book leverage and market leverage, which meant supporting pecking order theory. Growth opportunity (MBR) affected negatively to the market leverage. For the determinants of leverage, earnings volatility had significantly positive effect on KOSDAQ 50 firms. KOSDAQ and KOSDAQ 50 firms had the target leverage. The adjustment speed in KOSDAQ firms was 0.4958 on the book leverage, it was faster than in KOSDAQ 50 firm's 0.2863 on the book leverage and the adjustment speeds for the market leverage were 0.7651 for KOSDAQ firms and 0.5643 for KOSDAQ 50 firms. There was difference in adjustment cost between KOSDAQ firms and KOSDAQ 50 firms.