Financial system: Difference between revisions
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'''After reading this page:''' | |||
* you've learned what a financial system is | |||
* you've learned what role the financial system plays in the Tygron Engine | |||
* you've learned about the elements of the financial system in the Tygron Engine | |||
* you've learned how to adjust the financial system in the Tygron Engine | |||
[[File:FinanceLogo1.jpg|300px|right]]<br> | |||
<br clear=all> | |||
==Financial System== | |||
In finance, the '''financial system''' is the system that allows the transfer of money between savers (and investors) | |||
and borrowers.<ref>{{cite book | |||
| last = Sullivan | |||
| first = Arthur | |||
| authorlink = Arthur O' Sullivan | |||
|author2=Steven M. Sheffrin | |||
| title = Economics: Principles in action | |||
| publisher = Pearson Prentice Hall | |||
| year = 2003 | |||
| location = Upper Saddle River, New Jersey 07458 | |||
| pages = 551 | |||
| url = | |||
http://www.pearsonschool.com/index.cfm?locator=PSZ3R9&PMDbSiteId=2781&PMDbSolutionId=6724&PMDbCategoryId=&PMDbProgramId=12881&level=4 | |||
| doi = | |||
| id = | |||
| isbn = 0-13-063085-3}}</ref> A financial system can operate | |||
on a global, regional or firm specific level. Gurusamy, writing in ''Financial Services and Systems'' has described it as comprising "a set of complex and closely interconnected financial institutions, markets, instruments, services, practices, and transactions."<ref>Gurusamy, | |||
S. (2008). | |||
[http://books.google.co.uk/books?id=nPOSoSoRnycC&pg=PA3&dq=set+of+complex+and+closely+interconnected+financial+institutions,+markets,+instruments,+services,+practices,+and+transactions&hl=en#v=onepage&q&f=false ''Financial Services and Systems''] 2nd edition, p. 3. Tata McGraw-Hill | |||
Education. ISBN 0-07-015335-3</ref> | |||
According to Franklin Allen and Douglas Gale in ''Comparing Financial | |||
Systems'': | |||
<blockquote>"Financial systems are crucial to the allocation of resources in a modern economy. They channel household savings to the | |||
corporate sector and allocate investment funds among firms; they allow intertemporal smoothing of consumption by households and expenditures by firms; and they enable households and firms to share risks. These functions are common to the financial systems of most developed economies. Yet the form of these financial systems varies widely."<ref>{{cite book | |||
| last = Allen | |||
| first = Franklin | |||
| authorlink = Franklin Allen | |||
|author2=Douglas Gale | |||
| title = Comparing Financial Systems | |||
| publisher = MIT press | |||
| year = 2001 | |||
| location = 55 Hayward Street, Cambridge, MA 02142-1493, USA | |||
| pages = 520 | |||
| url = | |||
http://mitpress.mit.edu/catalog/item/default.asp?tid=8673&ttype=2 | |||
| doi = | |||
| id = | |||
| isbn = 978-0-262-51125-4}}</ref></blockquote> | |||
Financial systems depend on the countries viewpoint on freedom of trade. Some countries i.e. The Soviet Union had socialist financial systems because they value centralized organized state funded trading rather than freedom of trade by everyone. | |||
Revision as of 11:58, 29 October 2014
After reading this page:
- you've learned what a financial system is
- you've learned what role the financial system plays in the Tygron Engine
- you've learned about the elements of the financial system in the Tygron Engine
- you've learned how to adjust the financial system in the Tygron Engine
Financial System
In finance, the financial system is the system that allows the transfer of money between savers (and investors) and borrowers.[1] A financial system can operate on a global, regional or firm specific level. Gurusamy, writing in Financial Services and Systems has described it as comprising "a set of complex and closely interconnected financial institutions, markets, instruments, services, practices, and transactions."[2]
According to Franklin Allen and Douglas Gale in Comparing Financial Systems:
"Financial systems are crucial to the allocation of resources in a modern economy. They channel household savings to the corporate sector and allocate investment funds among firms; they allow intertemporal smoothing of consumption by households and expenditures by firms; and they enable households and firms to share risks. These functions are common to the financial systems of most developed economies. Yet the form of these financial systems varies widely."[3]
Financial systems depend on the countries viewpoint on freedom of trade. Some countries i.e. The Soviet Union had socialist financial systems because they value centralized organized state funded trading rather than freedom of trade by everyone.
- ↑ Template:Cite book
- ↑ Gurusamy, S. (2008). Financial Services and Systems 2nd edition, p. 3. Tata McGraw-Hill Education. ISBN 0-07-015335-3
- ↑ Template:Cite book