This book discusses the latest analytical developments in monetary economic theory. The Nature of Markets, The Role of Money, Micro-Economic Foundations of the Demand for Money, Macro-Economic Analysis of the Demand for Money, The Principles of Intermediation, Controlling the Supply of Money: A Problem for the Authorities?, Credit Rationing, Why Do Banks Need a Central Bank?, Financial Regulation, The Determination of Interest Rates, The Term Structure of Interest Rates, The Transmission Mechanism of Monetary Policy, The Effects of Nominal Monetary Changes on Output and Employment and Inflation, Monetary Policy 1: The Use of Policy Instruments in an Uncertain World, Monetary Policy 2: Rules Versus Discretion, The Regional Adjustment Process, International Monetary Relations 1: Exchange Rate Regimes, International Monetary Relations 2: The Turbulent Float, Bibliography, Index.