IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2604.24489.html

Property, Interest, and Money: Is Heinsohn and Steiger's Property Premium a Determinant of Interest?

Author

Listed:
  • Eric Hillebrand

Abstract

Heinsohn and Steiger's "Eigentum, Zins und Geld" (1996) proposes the property premium as the foundational determinant of interest, replacing time preference. This paper examines whether the replacement succeeds. It does not. The two arguments against time preference, the savings-inelasticity claim after Hahn and the portfolio-shift claim after Keynes, both fail on standard microeconomic grounds. With time preference intact, the property premium sits within the standard decomposition of the interest rate. In ordinary collateralized credit it coincides with the risk premium. Only when the lender is a money-issuing bank with a real redemption obligation does a third term enter the decomposition that standard asset-pricing theory does not articulate. That third term is Heinsohn and Steiger's genuine contribution. The paper discusses its apparent disappearance or disguised operation after 2008, and the circularity of a property anchor measured in money.

Suggested Citation

  • Eric Hillebrand, 2026. "Property, Interest, and Money: Is Heinsohn and Steiger's Property Premium a Determinant of Interest?," Papers 2604.24489, arXiv.org, revised May 2026.
    • Handle: RePEc:arx:papers:2604.24489
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2604.24489
    File Function: Latest version
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2604.24489. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.