noun[mass noun] Economics
(In Keynesian theory) the preference of investors for holding liquid assets rather than securities or long-term interest-bearing investments: [as modifier]: liquidity-preference theory
More example sentences
- In effect, ‘the classical version is superior because it avoids the confusion between money and credit which Friedman correctly notes as plaguing the Keynesian monetary or liquidity preference theory of interest’.
- He began his career as a Keynesian economist at Cambridge, leaning to liquidity preference theory against Robertson's loanable funds theory in the Cambridge monetary controversies.
- What we now call real balances or liquidity preference was long appreciated and treated as hoarding.