Examining modern money creation An institution centered explanation and visualization of the credit theory of money and some reflections on its.pdf (2.21 MB)
Examining modern money creation: an institution-centered explanation and visualization of the “credit theory” of money and some reflections on its significance
Version 2 2023-06-12, 07:49
Version 1 2023-06-10, 03:43
journal contribution
posted on 2023-06-12, 07:49 authored by Andrew HookAndrew HookDespite recent clarifications by central banks that it is indeed commercial banks that are the main creators of the money supply, money creation processes remain as confusing and opaque as ever to many. This article develops a simplified macro-visual diagram of today’s money system based on the increasingly accepted “credit theory” of money creation. It aims to explain not only how money is created and which institutions have the authority to create it; it also aims to discuss the implications of this understanding of money creation for wider issues, such as political sovereignty, inequality, and socio-economic development. Ultimately, it aims to provide a pedagogical resource upon which both technical and normative discussions about our current money system among academics, activists, and students can be based.
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Publication status
- Published
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- Published version
Journal
Journal of Economic EducationISSN
0022-0485Publisher
Taylor & FrancisExternal DOI
Page range
1-22Department affiliated with
- Geography Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2022-05-30First Open Access (FOA) Date
2022-05-30First Compliant Deposit (FCD) Date
2022-05-30Usage metrics
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