A contribution to the Quantity Theory of Disaggregated Credit

In my view, Richard Werner is sitting on a pot of gold. In Werner (2014), he has shown the tremendous potential his ‘Quantity Theory of Credit’ has to reorient public policy and stimulate nominal GDP. Yet, his ideas do not seem to take root. In this paper my aim is to refine his theory and provide some improvements by constructing new empirical proxies of ‘bank credit for GDP transactions’—a quite arduous and open-ended task. I conclude that the theory is very promising, but it is still in a stage of maturation.