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Money as an Institution of Capitalism: Some Notes on a Monetary Theory of Uncertainty
Author(s) -
Bertocco Giancarlo
Publication year - 2013
Publication title -
economic notes
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.274
H-Index - 19
eISSN - 1468-0300
pISSN - 0391-5026
DOI - 10.1111/ecno.12003
Subject(s) - capitalism , institution , economics , liquidity preference , preference , element (criminal law) , quantity theory of money , endogenous money , financial institution , neoclassical economics , market liquidity , keynesian economics , monetary economics , macroeconomics , monetary policy , microeconomics , sociology , law , social science , politics , political science
Dillard notes that to consider money as an institution of capitalism means to emphasize that money is an essential element in explaining fluctuations in income and employment. He states that Keynes's liquidity preference theory offers a sound explanation of money as an institution of capitalism. Keynes's explanation is based on a necessary condition, independent of money: the presence of uncertainty. The objective of the paper is to elaborate a different explanation of the role of money, based on Keynes's 1933 and 1937–39 works, according to which the presence of money constitutes the necessary condition to justify the importance of uncertainty.