Modern monetary systems

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Monograph

Identifikator:: 1753210836

URN:: urn:nbn:de:zbw-retromon-128414

Document type:: Monograph

Author:: Nogaro, Bertrand http://d-nb.info/gnd/117039713

Title:: Modern monetary systems

Place of publication:: London

Publisher:: King

Year of publication:: 1927

Scope:: XII, 236 S.

Digitisation:: 2021

Collection:: Economics Books

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INTRODUCTION vii standard of values out of a currency which has undergone fluctuations in purchasing power. Such fluctuations may be reduced to a minimum by merely varying the stock, i.e., by contracting the currency when prices rise and expanding it when they fall. Moreover, this invaluable theory combined with one or two other factors leads us to some ingenious corollaries. It may be asked why the precious metals, produced in a few countries, are so conveniently distributed over the large trading countries. The answer is that their produc- tion, by inflating the stocks of currency in the producing countries, provokes a rise in prices, which in turn creates the incentive to make purchases abroad and to pay for them by exporting the precious metals. How and why does international commerce naturally tend to reach equilibrium? Here again the Quantity Theory gives a simple explanation. Countries which have to pay for an import surplus, export species; but in so doing their stock of metal decreases, the units of currency become more and more scarce, and increase in value, ‘.e., prices fall; this fall stimulates exports and restores equilibrium. And so the explanation of monetary phenomena—or even of the general economic phenomena connected with the use of money—is apparently reduced to a mere applica- tion of such simple and elementary principles that it is easy to understand why any tyro will feel no diffidence in ex- pounding the subject as if he were an authority ; all he needs to do is to adhere rigidly to “sound doctrine.” Anyone who has investigated monetary phenomena scientifically for many years realises, of course, that the theory which has been summarised above rests upon a certain number of correct data, however crudely observed. But it also rests on many confused notions, the result of imperfect knowledge or incomplete analysis of the facts. While adequate in some cases, in many others it only has the appearance of a scientific explanation. The following pages are intended to give an explanation of monetary phenomena to-day which shall be more

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