« In praise of cookbook econometrics | Main | Wicksell and the hot potato »


Feed You can follow this conversation by subscribing to the comment feed for this post.

Neat! No useful comments, but I enjoyed reading this to broaden my scope.

A sympathetic treatment of MMT ;-)

The blog should have a "medieval" tag so people can follow the relevant posts :)

It would be more community focused and not inflationary with a money drop since everyone would gain and obtain the money to pay for any increase in prices.

Nick, That post of yours is brilliant. Herewith some comments.

1. When Oresme says that “government should have a monopoly to mint and issue coinage” he is effectively advocating full reserve banking. Abraham Lincoln said something similar: “The government should create, issue and circulate all the currency and credits needed to satisfy the spending power of the government and the buying power of consumers.” Thomas Jefferson thought likewise.

2. Oresme says “coinage does not belong to government but is a form of common property belonging to those community members…”. That sentiment was repeated by the inventor, Thomas Edison. See last paragraph here:


3. You say “When governments engage in quantitative easing they are doing so on behalf of their “communities”..” I’m not happy with that. QE channels money into the pockets of asset rich people and institutions. It would make as much sense to channel money into the pockets of red headed females aged 30 to 40 and hope for a trickle down effect. I.e. when there is a recession and “the people” need more money, we should channel month into the pockets of ordinary households, seems to me.

4. I may be putting words into your mouth, but you seem to say that QE might be more inflationary per job created than other forms of stimulus. I don’t care for QE (for reasons given above in connection with red headed females) but I don’t see why it would be more inflationary per job created than other forms of stimulus.

On second thoughts I overstepped the mark when I said that Orseme was effectively advocating full reserve. If he meant his coin minting point to extend to book keeping type money creation by commercial banks, then he WAS advocating full reserve. But if he meant something similar to what most countries have today, namely that only the central bank can print dollar / pound etc bills and coins, while commercial banks can still create book keeping type money, than that is not full reserve.

Ralph: Thanks! But this is Livio's post!

Ralph Musgrave, QE sells money at market prices (in bonds), so it does not matter where the money is "channeled" to. Those who hold money balances lose in expectation, unless they increase spending quickly--but that's by design. At the end of the day, the distributional effects are the same as any increase in money supply.

Interesting. Is Oresme also anticipating much modern confusion between coinage and money? I believe that most ancient and medieval coins - like modern ones - circulated at values well above the value of the metal in them. What determined the premium?

Also, most non-local or large transactions (eg at the famous Fairs of Champagne) were conducted in monies of account - usually the livre tournois - for which there was no direct coin equivalent, with most of the apparatus (synthetic debt instruments thankfully excepted - medieval life was hard enough) of modern finance. Is Oresme muddling the medium with the most common representation?

The comments to this entry are closed.

Search this site

  • Google

Blog powered by Typepad