Modigliani and the question of the existence of an equilibrium in a flexible price model[Modigliani et la question de l’existence d’un équilibre dans un modèle à prix flexibles]

In 1955, Franco Modigliani wrote his lecture notes for the Carnegie Institute of Technology. This document, entitled Preliminary Notes on the Theory of Money and Interest in the Framework of General Equilibrium Analysis, has remained unpublished. Working within a temporary equilibrium model similar to that developed by Hicks in Value and Capital, Modigliani proposes a monetary theory similar to but different from that proposed by Patinkin in Money, Interest and Prices. It establishes that this model does not necessarily have an equilibrium if prices and wages are flexible. It shows that the propositions usually associated with quantitative theory-the dichotomy between the monetary and real sectors, the neutrality of money, the parallelism of price and money movements-are not generally verified. It introduces wage and price rigidity into the general equilibrium model to construct an appropriate framework for the study of monetary policies. This innovative text is important for understanding how monetary theory was conceived and taught in the United States in the 1950s. Mots clefs: Modigliani, Théorie monétaire, Effet d'encaisse réelle, Théorie quantitative