Saving, Investment, and the Financial System 储蓄,投资和金融系统.ppt

26.3.1 Supply and Demand for Loanable Funds The interest rate is the price of the loan. It represents the amount that borrowers pay for loans and the amount that lenders receive on their saving. The interest rate in the market for loanable funds is the real interest rate. 26.3.1 Supply and Demand for Loanable Funds Financial markets work much like other markets in the economy. The equilibrium of the supply and demand for loanable funds determines the real interest rate. Figure 1 The Market for Loanable Funds Loanable Funds (in billions of dollars) 0 Interest Rate Supply Demand 5% $1,200 Copyright?2004 South-Western 26.3.1 Supply and Demand for Loanable Funds Government Policies That Affect Saving and Investment Taxes and saving Taxes and investment Government budget deficits 26.3.2 Policy 1: Saving Incentives Taxes on interest income substantially reduce the future payoff回报,报偿 from current saving and, as a result, reduce the incentive to save. 26.3.2 Policy 1: Saving Incentives A tax decrease increases the incentive for households to save at any given interest rate. The supply of loanable funds curve shifts to the right. The equilibrium interest rate decreases. The quantity demanded for loanable funds increases. Figure 2 An Increase in the Supply of Loanable Funds Loanable Funds (in billions of dollars) 0 Interest Rate Supply, S1 S2 2. . . . which reduces the equilibrium interest rat e . . . 3. . . . and raises the equilibrium quantity of loanable funds. Demand 1. Tax incentives for saving increase the supply of loanable fund s . . . 5% $1,200 4% $1,600 Copyright?2004 South-Western 26.3.2 Policy 1: Saving Incentives If a change in tax law encourages greater saving, the result will be lower interest rates and greater investment. 26.3.3. Policy 2: Investment Incentives An investment tax credit 投资税赋减免increases the incentive to borrow. Increases the demand for loanable funds. Shifts the demand curve to the right. Results in a higher interest rate and a greater