Finanzinnovationen und Geldpolitik | Schlußfolgerungen aus einem erweiterten Finanzmarktmodell

Financial Innovation and Monetary Policy — Conclusions from an Extended Portfolio Model The stimulus for financial innovation arises from the interaction of a changing regulatory environment, expanding technology, volatile markets, growing competition among financial institutions and shifting macroeconomic unbalances. Financial innovation and the associated structural change in the financial system may have farreaching implications for the conduct of monetary policy directed to a growth target and for the relationship between monetary policy and the domestic macro-economy. This essay begins by outlining the individual effects of the financial innovation process on the definition of money, the supply of and demand for money, international capital mobility and the monetary transmission mechanism. Subsequently, some specific implications of financial innovations, e.g. the reduced variability of net payment flows or transformation costs between assets, are analyzed in an extended portfolio or asset approach, which emphasizes the role of portfolio balance considerations and is able to investigate systematically e.g. valuation (wealth) effects, expectation effects or aspects of induced currency substitution