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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Document type:: Monograph

Structure type:: Chapter

Title:: Conclusion

Collection:: Economics Books

CONCLUSION 231 explained by a knowledge of exchange mechanism under monetary régimes which require to be exactly described and the working of which must be accurately ascertained. Finally, we have shown that such phenomena are often unconnected with superficial considerations of quantity with which they have been connected in the absence of a sufficiently detailed knowledge of the data. It has also seemed to us that the idea of commodity, far from being an essential element in the conception of money, tends, on the contrary, to disappear in the course of history; and it is impossible to explain in terms of this idea monetary phenomena which are directly bound up with the theory of value. For we have shown that the idea of supply and demand cannot be borrowed from a normal market with free competition between buyer and seller and applied to quite a different market, such as is created by the system of free coinage, where the supply of precious metal is always certain to find an unlimited demand at a fixed rate. On the other hand, we have shown that if the law of supply and demand is applicable to money subject to the reserve which may be made in regard to the Quan- tity Theory, the volume of currency in circulation is no longer in direct relation to the quantity of precious metal transformed into currency. Hence the part played by a metallic currency and its production in determining the value of a monetary unit tends to become smaller. When the system of free coinage was established, the value of fresh metal was fixed in relation to that of the monetary unit ; thereafter it could no longer have any appreciable effect on the value of the monetary unit. We have thus been led to a more modest, but, as we believe, a more accurate definition of the function of gold as an inter- national currency; we do not see in it—as is commonly supposed—a kind of physical support for abstract monet- ary units, but rather as a machine for transforming national monetary units into each other at a fixed rate. For 1We have shown that exchange has become more and more im- portant as compared with inflation in bringing about a rise in prices at the present day.

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