Modern monetary systems

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Monograph

Identifikator:: 1739110889

URN:: urn:nbn:de:zbw-retromon-131976

Document type:: Monograph

Title:: Niederlande

Place of publication:: Berlin

Publisher:: Mittler

Year of publication:: 1926

Scope:: IV, 131 Seiten

Digitisation:: 2020

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Tarif

Collection:: Economics Books

166 MODERN MONETARY SYSTEMS “an object which is received in exchange for goods or services with a view to subsequent exchange.” On the other hand, we hold that if money is not essentially a commodity this does not prevent the quantity theory from being applicable to it, subject to the remarks made in the preceding chapter. A monetary instrument, whether it be actual coin or a mere token, may be more or less abundant. Its abundance, by according additional purchasing media, may provoke a rise in prices or in other words depreciate its exchange value in relation to the goods or services demanded. But monetary phenomena cannot be explained solely by variations in value similar to the variations in the value of any commodity on any market. On the contrary, we believe it can be shown by an analysis of the facts described in the first part of this book that the value of precious metals under a system of free coinage, i.e., convertible in unlimited quantities into a given number of units of account, is determined under very special conditions and we believe that this analysis will help us to define more accurately the exact meaning of a monetary standard. § 2. The value of money. We have already shown (Part I, Ch. II) that, contrary to the expectations of the legislators of the Year XI and to the views still commonly accepted, the experience of bimetallists in the 19th century showed that it was possible to maintain a stable exchange ratio between two monetary metals which were both accepted for free coinage and which were meant to be treated like any other com- modity. And the explanation of this phenomenon is quite simple. For, owing to the freedom of coining both metals, which enabled each of them to be converted ad libitum into coin, the institution of a legal ratio between gold and silver currencies resulted in a constant exchange ratio between the metals even without their being actually coined. The stable exchange ratio between the two metals in bimetallist countries was the direct result of the fact that any individual could transform either at will into currencies

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