Bank loans drive money creation in Poland, challenging traditional views.
The study looked at how money is created in Poland, comparing two theories. They found that in Poland, money supply is not controlled by the government but is instead influenced by the demand for bank loans. This means that when people borrow money from banks, it creates new money in the economy. The traditional idea that banks only lend out money they already have is not true in Poland. This has important implications for how the Polish central bank should think about managing the country's money supply.