Whither Loose Change? The Diminishing Demand for Small-Denomination Currency

While payment card usage has increased dramatically, the stock of outstanding currency has not declined as rapidly. We analyze changes in cash demand for 13 advanced economies from 1988 to 2003 by separating cash into three denomination categories to disentangle its store of wealth and payment functions. Defining denominations commonly dispensed by automated teller machines (ATMs) as the "medium" category, we show that demand for small-denomination currency decreases with greater debit card usage and with greater retail market consolidation. In contrast, the demand for high-denomination notes decreases when interest rates rise but is generally unaffected by changes in debit card usage.     

MONETARY OVERHANG: DO CENTRALLY PLANNED ECONOMIES HAVE EXCESSIVE MONEY STOCKS?

This paper investigates the issue of monetary overhang in centrally planned economies (CPEs). The analysis compares the money stocks in CPEs with those in market economy counterparts. Contrary to conventional belief, the findings here suggest that the money stocks in traditional CPEs do not tend to be excessive. This implies that CPEs suffer more from structural distortion than from monetary overhang in their traditional stage .     

The “Ethics of Social Ideas” Versus The “Ethics of Marketing Social Ideas”

Can the public make a distinction between the “ethics of social ideas” versus the “ethics of marketing social ideas”? This question was empirically assessed via a survey research design. The evidence strongly suggests that individuals cannot totally separate the social idea from the marketing technique used to promote the idea. Also it was found that some social issues are more likely to foster strong ethical concerns than others. The implications of this research are discussed.     

Solicitation and the Legal Profession: A New Issue for Consumer Affairs Professionals

While issues relating to the advertising of legal services have received much attention in the scholarly literature, this has not been the case for solicitation by lawyers, even though it appears that lawyers are more interested in being able to solicit than to advertise. In this article the legal issues surrounding solicitation are identified and tied to a basic communications model; then research propositions are presented along with the results of a survey of attitudes held toward solicitation by 125 lawyers practicing in two Rocky Mountain states. The survey results suggest that solicitation is not going to be easily accepted and that many lawyers may have trouble evaluating differences among solicitation, direct mail and advertising. The survey results also suggest that attitudes toward solicitation may be changing in that younger, less experienced respondents expressed more liberal attitudes toward solicitation than their older and more experienced colleagues. Taken together the findings of this article strongly suggest that solicitation is likely to offer a complex and challenging development for consumer affairs professionals in the years ahead.     

STRUCTURAL INFLATION AND THE 1994 'MONETARY' CRISIS IN CHINA

This paper examines the 1994 inflation in China, which occurred at a time when the government was vigorously conducting macroeconomic contraction. The event deserves more attention for both academic and policy research reasons. The paper shows that the inflation was led by food price increases, a step of price reform intended to adjust relative price ratios to the equilibrium level. The nature of the inflation was structural rather than monetary. This kind of structural inflation is common in transitional economies. Indeed, it largely characterizes chronic price increases that have occurred in such countries. A proper monetary policy curbing inflation should take into account the structural factor. Monetary growth should be targeted to the extent that it accommodates structural adjustment but does not cause pure monetary inflation.