Purchasing power volatility
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How much the series fluctuates over time
spontaneous order theory of money
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Describes a situation where the outcome is not the intention of the relevant
decision-makers.
The outcome- money - is a product of human action, but not of human
design.
,increase in long run marginal cost of producing gold coins
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Immediately following the shock, there is no change in quantity of coins or
purchasing power.
Eventually, supply adjusts:
§quantity of coins decreases
§purchasing power increases
Basic idea of historical view
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§ Basic idea: difficult to raise tax revenue in a non-monetary economy; gov
(or proto-gov) requires tax payments in some assets, and taxpayers must
sell some of their output for the specified asset in order to pay their taxes.
Definition of commodity money
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good that functions as money (monetary and non-monetary uses)
Why do we use money?
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, -Historical Materialist View
- Economic View
real output volatility
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§"figment" of the data
§ Yt=Nt/Pt
Yt = is real output,
Nt = is nominal output
Pt = is the price level.
state theory of money
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-aka chartalism, maintains that money was created by government.
o Some chartalists define money as a government-issued token
o Others define money conventionally but nonetheless see money as a
creature of the state
endogenous money
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How much the series fluctuates over time
spontaneous order theory of money
Give this one a try later!
Describes a situation where the outcome is not the intention of the relevant
decision-makers.
The outcome- money - is a product of human action, but not of human
design.
,increase in long run marginal cost of producing gold coins
Give this one a try later!
Immediately following the shock, there is no change in quantity of coins or
purchasing power.
Eventually, supply adjusts:
§quantity of coins decreases
§purchasing power increases
Basic idea of historical view
Give this one a try later!
§ Basic idea: difficult to raise tax revenue in a non-monetary economy; gov
(or proto-gov) requires tax payments in some assets, and taxpayers must
sell some of their output for the specified asset in order to pay their taxes.
Definition of commodity money
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good that functions as money (monetary and non-monetary uses)
Why do we use money?
Give this one a try later!
, -Historical Materialist View
- Economic View
real output volatility
Give this one a try later!
§"figment" of the data
§ Yt=Nt/Pt
Yt = is real output,
Nt = is nominal output
Pt = is the price level.
state theory of money
Give this one a try later!
-aka chartalism, maintains that money was created by government.
o Some chartalists define money as a government-issued token
o Others define money conventionally but nonetheless see money as a
creature of the state
endogenous money
Give this one a try later!
