This paper examines how monetary expansion causes asset bubbles. When there is no monetary expansion, a bubbly asset is not created due to a hold-up problem. Monetary expansion increases buyers' money holdings, and then, dealers are willing to buy a worthless asset from sellers, in hopes of...

Today all countries have fiat money issued by a central bank. There is no obligation by a central bank to exchange its money for gold or any other good. Central banks have the monopoly to issue central bank money and have the power to create their money out of nothing. Creating such a monetary...

This paper proposes a theory of the mark-up that is embedded in a circuit model of the capitalist mode of production. The model and the theory are built on Keynes's principle of effective demand, Graziani's monetary theory of production and Pivetti's monetary theory of distribution. The...

An early analysis of the imperialist implications of the surge of global commodity prices was conducted in 2014 by Jonathan Nitzan and Shimshon Bichler. However, their analysis did not consider how the US monetary and fiscal expansionist policies have contributed to the rise of global commodity...

This paper proposes a theory of the mark-up that is embedded in a circuit model of the capitalist mode of production. The model and the theory are built on Keynes's principle of effective demand, Graziani's monetary theory of production and Pivetti's monetary theory of distribution. The price-...

Money, capitalist market societies' paramount contract, relies on the belief in its enduring value. However, we still know surprisingly little about the social foundations that sustain that belief. How is our collective trust in the enduring value of money socially built, and what happens if...

We propose a standard search and bargaining model with divisible money, in which only the random matching market opens and the generalized Nash bargaining settles each trade. Assuming fixed production costs, we analytically characterize a tractable equilibrium, called a pay-all equilibrium , and...

We field a series of experiments in a population-representative survey of European consumers to examine their attitudes towards the possible introduction of a digital euro. First, we show that a short video explaining the key features of the digital euro is effective in changing consumers'...

We field a series of experiments in a population-representative survey of European consumers to examine their attitudes towards the possible introduction of a digital euro. First, we show that a short video explaining the key features of the digital euro is effective in changing consumers'...

After providing a general overview of the nature, pros, and cons of crypto assets and CBDCs, this paper focuses on documenting their recent experience in LAC. The region records a high interest in unbacked crypto assets and stablecoins and its authorities' policy responses have varied...

This paper proposes a theory of the mark-up that is embedded in a circuit model of the capitalist mode of production. The model and the theory are built on Keynes's principle of effective demand, Graziani's monetary theory of production and Pivetti's monetary theory of distribution. The price-...

Money, capitalist market societies' paramount contract, relies on the belief in its enduring value. However, we still know surprisingly little about the social foundations that sustain that belief. How is our collective trust in the enduring value of money socially built, and what happens if...

For the past hundred years or more, payments have been primarily associated with banking, and banking as we know it today-being the result of many centuries of evolution-features a bundling of (at least) three main lines of business: lending, deposit-taking, and payment services. In the past 15...

We propose a standard search and bargaining model with divisible money, in which only the random matching market opens and the generalized Nash bargaining settles each trade. Assuming fixed production costs, we analytically characterize a tractable equilibrium, called a pay‐all equilibrium ,...

We use agent-based modelling to build a digital twin of the retail payment system, where heterogeneous consumers and merchants interact, learn, and adapt as they meet and use different monies and payment instruments. As we introduce an rCBDC, the model simulates its adoption. We calibrate this...

This paper examines the potential impact a central bank digital currency (CBDC) on banks' balance sheets. We first analyze the possible implications of the introduction of a CBDC for the banking system and the economy as a whole. Our analysis indicates that the impact of a CBDC depends on a...

This paper proposes a theory of the mark-up that is embedded in a circuit model of the capitalist mode of production. The model and the theory are built on Keynes's principle of effective demand, Graziani's monetary theory of production and Pivetti's monetary theory of distribution. The...

This working paper integrates the credit money approach (associated with Post Keynesian endogenous money theory) with the state money approach (associated with Modern Money Theory) by drawing on Wray's 1990 book (Money and Credit in Capitalist Economies: The Endogenous Money Approach, Edward...

Modern exchange theories model a large market, but do not explain single exchanges. This paper considers the phenomenon of single exchange and formulates the general exchange problem in the form of a system of two equations, subjective and objective. Subjective equilibrium is given by the...

The present work offers a review on two divergent schools of thought regarding the subject of money and highlights why understanding it is important to grasp the workings and nature of the concept of money. We adopt a spontaneous order perspective on social institutions, considering money as...

The number of digital currencies has increased significantly in recent years. So-called central bank digital currencies (CBDCs), created by central banks, are at the forefront of this development. Combining the advantages of an electronic means of payment - namely the speed and efficiency of...

The literature on international transfers has studied the possibility of transfer paradoxes; the donor gains and the recipient loses from a transfer. This can occur in a wide range of circumstances, including perfect competition and the absence of distortions. The literature, however, largely...

Scholars and affiliates of the Levy Economics Institute have long demonstrated a granular understanding of the "operations" of money, which entails understanding the financial system's law and technology (Grey 2019, Tymoigne 2014, Fullwiler 2010, Bell and Wray 2002-3, Bell 2000). During the...

We create an alternative version of the present utility value formula to explicitly show that every store-of-value in the economy bears utility-interest (non-pecuniary income) for its holder regardless of possible interest earnings from financial markets. In addition, we generalize the...

This paper examines how monetary expansion causes asset bubbles. When there is no monetary expansion, a bubbly asset is not created due to a hold-up problem. Monetary expansion increases buyers' money holdings, and then, dealers are willing to buy a worthless asset from sellers, in hopes of...

What explains the US dollar's role in the global economy and the tensions affecting its likely persistence? Most analyses start from Triffin's dilemma, which accurately captured specific but partial tensions of a global monetary system based on essentially fixed exchange rates, gold backing for...

Today all countries have fiat money issued by a central bank. There is no obligation by a central bank to exchange its money for gold or any other good. Central banks have the monopoly to issue central bank money and have the power to create their money out of nothing. Creating such a monetary...

When it comes to Bitcoin, there’s one thing that almost everyone agrees on: the network sucks up a tremendous amount of energy. But from there, disagreement is the rule. For critics, Bitcoin’s thirst for energy is self-evidently bad — the equivalent of pouring gasoline in a hole and...

The concept of a hierarchy of money or the idea that a number of instruments constitute money and that they are hierarchically related to one another is relatively recent and yet quite widespread. However, it is argued, that its comprehension differs. The most elaborated cases in which differing...

Monetary targeting served as a useful tool for conducting monetary policy until 1980s, but the instability in the relationship between money and nominal income led to its abandonment by most economies. One way of measuring this relationship is money velocity, defined as the ratio of nominal...