Monetary Transition : The Case for Money serving the Common Good

Veblen Institute note

Jézabel Couppey-Soubeyran, Pierre Delandre, May 2021

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Summary :

The monetary landscape is turbulent. Alongside monetary innovations such as cryptocurrencies and local currencies, various proposals are being developed aimed at reforming the monetary system, on either an ad hoc or a structural basis. These proposals include concepts such as “helicopter money”, the cancellation of public debts held by central banks, monetary “donation”, and Modern Monetary Theory. In response to the financial and pandemic crises, central banks are, for their part, pursuing “unconventional measures” at odds with their normal mode of action, providing unprecedented amounts of money to banks and financial markets.

In some respects, this monetary turbulence resembles the turmoil of the 19th century, when the innovators of the time, heralds of the “banking principle”, called for a monetary system adapted to the needs of a fast-growing economy, freed from the gold standard, while the conservatives, defenders of the “currency principle”, clung to the traditional metallic definition of money.

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