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Economics of Money, Banking, and Financial Markets, The, 12th edition

Published by Pearson (January 10, 2018) © 2019

  • Frederic S. Mishkin
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For money and banking, or general economics courses.

A unified framework for understanding financial markets

The Economics of Money, Banking & Financial Markets brings a fresh perspective to today's major questions surrounding financial policy. Influenced by his term as Governor of the Federal Reserve, Frederic Mishkin offers students a unique viewpoint and informed insight into the monetary policy process, the regulation and supervision of the financial system, and the internationalization of financial markets.

The 12th Edition provides a unifying, analytic framework for learning that fits a wide variety of syllabi. Core economic principles and real-world examples organize students' thinking and keep them motivated.

Hallmark features of this title

  • A unifying framework uses a few basic principles to organize students' thinking about the structure of financial markets, foreign exchange markets, financial institution management, and the role of monetary policy in the economy.
  • Graphs and 80+ Mini-Lecture Videos help students understand the interrelationships among the plotted variables and the principles of analysis.
  • An international perspective gives students an idea of how economies operate around the world.
  • 50+ Applications show how the analysis presented can explain many important real-world situations.
  • FYI boxes highlight dramatic historical episodes, and interesting ideas and facts related to the material.
  • 600+ end-of-chapter questions and applied problems help students learn by applying the concepts.

New and updated features of this title

  • NEW: Chapter 1, “Why Study Money, Banking, and Financial Markets?,” teaches students about career opportunities available beyond Wall Street or in a bank.
  • NEW: Chapter 4, “The Meaning of Interest Rates,” illustrates negative interest rates in countries like Japan, the US and Europe.
  • NEW: Chapter 5, “The Behavior of Interest Rates,” shows how the supply and demand model explains current interest rate movements.
  • NEW: Chapter 12, “Financial Crises,” discusses current debates in Congress on financial regulation, and post Dodd-Frank.
  • NEW: Chapter 17, “The Foreign Exchange Market,” highlights an application on Burgernomics, Big Macs, and Purchasing Power Parity, as a fun way of showing students how purchasing power parity works in practice.
  • UPDATED: Global Box in Chapter 18, “The International Financial System,” helps students interpret claims made about the large US current account deficit in both the media and in Congress.

Features of MyLab Economics for the 12th Edition

  • Real-Time Data Analysis Exercises use up-to-the-minute, real-time macroeconomic data from the Federal Reserve Bank of St. Louis's FRED™ site, to test students' knowledge.
  • Homework and practice exercises in MyLab are correlated to exercises in the text, reflecting each author's approach and learning style. They regenerate algorithmically to give students unlimited opportunity for practice and mastery.
  • Learning aids, such as Help Me Solve This, provide extra help for students at the point-of-use.
  • Gradescope is an efficient grading platform that streamlines the way you create and grade online exams, homework and projects.
  • With LMS Integration, you can link your MyLab course from Blackboard Learn™, Brightspace® by D2L®, Canvas™, or Moodle®.

PART I: INTRODUCTION 1

1. Why Study Money, Banking, and Financial Markets?

2. An Overview of the Financial System

3. What Is Money?      


PART II: FINANCIAL MARKETS

4. The Meaning of Interest Rates

5. The Behavior of Interest Rates

6. The Risk and Term Structure of Interest Rates

7. The Stock Market, the Theory of Rational Expectations, and the Efficient Market Hypothesis   


PART III: FINANCIAL INSTITUTIONS 

8. An Economic Analysis of Financial Structure

9. Banking and the Management of Financial Institutions

10. Economic Analysis of Financial Regulation

11. Banking Industry: Structure and Competition

12. Financial Crises


PART IV: CENTRAL BANKING AND THE CONDUCT OF MONETARY POLICY  

13. Central Banks and the Federal Reserve System

14. The Money Supply Process

15. Tools of Monetary Policy

16. The Conduct of Monetary Policy: Strategy and Tactics


PART V: INTERNATIONAL FINANCE AND MONETARY POLICY 

17. The Foreign Exchange Market

18. The International Financial System


PART VI: MONETARY THEORY 

19. Quantity Theory, Inflation, and the Demand for Money

20. The IS Curve

21. The Monetary Policy and Aggregate Demand Curves

22. Aggregate Demand and Supply Analysis

23. Monetary Policy Theory

24. The Role of Expectations in Monetary Policy

25. Transmission Mechanisms of Monetary Policy


CHAPTERS ON THE WEB 

1. Financial Crises in Emerging Market Economies

2. The ISLM Model

3. Nonbank Finance

4. Financial Derivatives

5. Conflicts of Interest in the Financial Services Industry

About our author

Frederic S. Mishkin is the Alfred Lerner Professor of Banking and Financial Institutions at the Graduate School of Business, Columbia University. He is also a Research Associate at the National Bureau of Economic Research, co-director of the US Monetary Policy Forum, a member of the Squam Lake Working Group on Financial Reform, and past president of the Eastern Economics Association. Since receiving his PhD from the Massachusetts Institute of Technology in 1976, he has taught at the University of Chicago, Northwestern University, Princeton University, and Columbia. He has also received an honorary professorship from the People's (Renmin) University of China. From 1994 to 1997, he was Executive Vice President and Director of Research at the Federal Reserve Bank of New York and an associate economist of the Federal Open Market Committee of the Federal Reserve System. From September 2006 to August 2008, he was a member (governor) of the Board of Governors of the Federal Reserve System.

Professor Mishkin's research focuses on monetary policy and its impact on financial markets and the aggregate economy. He is the author of more than 20 books, including Macroeconomics: Policy and Practice, 2nd Edition (Pearson, 2015); Financial Markets and Institutions, 9th Edition (Pearson, 2018); Monetary Policy Strategy (MIT Press, 2007); The Next Great Globalization: How Disadvantaged Nations Can Harness Their Financial Systems to Get Rich (Princeton University Press, 2006); Inflation Targeting: Lessons from the International Experience (Princeton University Press, 1999); Money, Interest Rates, and Inflation (Edward Elgar, 1993); and A Rational Expectations Approach to Macroeconometrics: Testing Policy Ineffectiveness and Efficient Markets Models (University of Chicago Press, 1983). In addition, he has published more than 200 articles in such journals as American Economic Review, Journal of Political Economy, Econometrica, Quarterly Journal of Economics, Journal of Finance, and Journal of Monetary Economics.

Professor Mishkin has served on the editorial board of American Economic Review and has been an associate editor at Journal of Business and Economic Statistics, Journal of Applied Econometrics, Journal of Economic Perspectives, Journal of International Money and Finance, and Journal of Money, Credit and Banking; he also served as the editor of the Federal Reserve Bank of New York's Economic Policy Review. He is currently an associate editor (member of the editorial board) at 6 academic journals, including International Finance; Finance India; Review of Development Finance; Borsa Economic Review; PSU Research Review and Emerging Markets, and Finance and Trade. He has been a consultant to the Board of Governors of the Federal Reserve System, the World Bank, and the International Monetary Fund, as well as to many central banks throughout the world. He was also a member of the International Advisory Board to the Financial Supervisory Service of South Korea and an advisor to the Institute for Monetary and Economic Research at the Bank of Korea. Professor Mishkin was a Senior Fellow at the Federal Deposit Insurance Corporation's Center for Banking Research and was an academic consultant to and serves on the Economic Advisory Panel and Monetary Advisory Panel of the Federal Reserve Bank of New York.

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