Loanable Funds Theory: Demand and Supply
The neo-classical theory of interest or loanable funds theory of interest is originated by the Swedish economist Knut Wicksell. Later on, economists like Ohlin, Myrdal, Lindahl, Robertson, and J. Viner considerably contributed to this theory. According to this theory, the rate of interest is determined by the demand and supply of loanable funds. This theory … Read more
