Loanable funds

In economics, the loanable funds doctrine is a theory of the market interest rate. According to this approach, the interest rate is determined by the demand for and supply of loanable funds. The term loanable funds includes all forms of credit, such as loans, bonds, or savings deposits. In economics, the loanable funds doctrine is a theory of the market interest rate. According to this approach, the interest rate is determined by the demand for and supply of loanable funds. The term loanable funds includes all forms of credit, such as loans, bonds, or savings deposits. The loanable funds doctrine was formulated in the 1930s by British economist Dennis Robertson and Swedish economist Bertil Ohlin. However, Ohlin attributed its origin to Swedish economist Knut Wicksell and the so-called Stockholm school, which included economists Erik Lindahl and Gunnar Myrdal.