Transactions motive

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Transactions motive

A desire to hold cash in order to conduct cash-based transactions.

Transactions Motive

The desire of an economic actor to maintain sufficient funds in a bank account in order to write checks on that account for daily needs and wants. A person with higher income has a greater transactions motive than a person with lower income; that is, that person wants to have more money in order to spend more. In Keynesian economics, the transactions motive is one of three reasons persons demand liquidity. See also: Liquidity preference, precautionary motive, speculative motive.

References in periodicals archive ?

This paper argues that currency substitution refers to a country's residents for the transaction motive, precautionary motive, portfolio motive (i.

Research on currency substitution in developing country based on multiple motivations and big data analytics

The transaction motive is the main reason of cash holding [6].

The cash flow sensitivity of cash holdings

The transaction motive for holding cash is probably best expressed by using a narrow definition of consumption.

Norges Bank's management of cash inventories

Thus, both the transaction motive and the financing motive appear to be economically significant

The demand for trade credit: an investigation of motives for trade credit use by small business

The transaction motive stems from the demand that a firm desires to use a certain amount of cash to satisfy the basic routine demand of cash outflow exactly (Miller and Orr, 1966).

Analysis of the impact of corporate cash holdings on product market performance based on did evaluation model