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Money and Banking
Paper Code:
ECO 512
Credits:
3
Contact Hours:
45.00
Max. Marks:
100.00
Objective:
- To grasp the concept of money and the foundation of monetary theory; and
- To understand the nature, types and control of inflation.
8.00
Unit I:
Money
- Meaning, functions and classification of money;
- Demand for and supply of money;
- Theory of Money supply and Money Multiplier Process;
- The concept of Plastic Money.
9.00
Unit II:
Quantity Theory of Money
- Transactions and Cash Balance Approach;
- Keynesian Theory;
- Friedman’s reformulation.
9.00
Unit III:
Value of Money & its Changes
- Inflation - Definition, causes and effects;
- Demand-pull and cost-push inflation & concept of inflationary gap;
- Trade – off between inflation and unemployment;
- Measures to control inflation;
- Deflation;
- Inflation versus Deflation.
9.00
Unit IV:
Commercial Banks
- Commercial banks - functions;
- Balance sheet of Banks- assets and liabilities;
- Credit Creation: Mechanism, purpose and limitations;
- Reforms of the banking sector (1992 - 2003).
10.00
Unit V:
Co-operative Banks
- Co-operative Banks – Characteristic Features;
- Types & Structure;
- Weaknesses of Co-operative Banks;
- Government’s initiatives and Co-operative Banking Reforms since 1991.
Essential Readings:
- Gupta, S.B. (1983), Monetary Economics, S. Chand & Co., New Delhi.
- Mitra, S. (1970), Money and Banking, Random House, New York.
- Mithani, D.M.,Money, Banking, International Trade & Public Finance, Himalaya Publisher.
- Sundaram,K.P.M., Money, Banking, & International Trade, Sultan Chand.
References:
- Rangarajan, C. (1999), Indian Economics: Essays on Money and Finance, UBS Publisher, New Delhi.
- RBI (1983), Functions and Working of RBI, Bombay.
- RBI (2000), Report on Trend and Progress of Banking in India (Annual), Mumbai.
- Reddy, Y.V. (2000), A Review of Monetary and Financial Sector Reforms in India-A Central Banker’s Perspective, UBSPD, New Delhi.
Academic Session:
