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Endogenous versus exogenous money: Does the debate really matter?

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  • Sieroń, Arkadiusz

Abstract

Whether money is exogenous or endogenous is the subject of one of the most important and intriguing debates in monetary economics. The aim of this article is to contribute to this longstanding debate through detailed examination of different notions of endogeneity and exogeneity of money. I argue that the debate has been too simplified. In reality, money can be either endogenous or exogenous, depending on several factors. Not only has the debate prompted some economists to draw too far-reaching conclusions, but it also misses the point.

Suggested Citation

  • Sieroń, Arkadiusz, 2019. "Endogenous versus exogenous money: Does the debate really matter?," Research in Economics, Elsevier, vol. 73(4), pages 329-338.
    • Handle: RePEc:eee:reecon:v:73:y:2019:i:4:p:329-338
    DOI: 10.1016/j.rie.2019.10.003
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    Cited by:

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    2. Pawe³ Œliwiñski, 2023. "Endogenous money supply, global liquidity and financial transactions: Panel evidence from OECD countries," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 18(1), pages 121-152, March.
    3. Jeremy Srouji, 2021. "Why is World Money World Money? A View from the Functions of Money," GREDEG Working Papers 2021-44, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    4. Ostapenko, V. & Buglevsky, E., 2022. "Money supply in the history of macroeconomic thought: 50 shades of endogeneity," Journal of the New Economic Association, New Economic Association, vol. 55(3), pages 156-176.
    5. Sholihin, Muhammad & Shalihin, Nurus & Putra, Apria, 2021. "Paper money in Sheikh Ahmad Khatib Al-Minangkabawi’s thought: a comparative and critical commentary," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 29, pages 67-83.

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    More about this item

    Keywords

    Endogenous money; Exogenous money; Money; Money creation; Money supply; Banks; Central banks;
    All these keywords.

    JEL classification:

    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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