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L. Walras and C. Menger: Two ways on the path of modern monetary theory

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  • Andrés Alvarez
  • Vincent Bignon

Abstract

This paper shows that modern monetary theory can be better understood through the differences between Menger and Walras. Since the 1980s attempts to establish coherent microfoundations for monetary exchange have brought Menger's theory of the origin of money to the forefront and sent walrasian methods to the backstage. However, during the first decade of the XXIth century models inspired on mengerian monetary theory, mainly represented by the search monetary approach, are trying to reintroduce neowalrasian elements. This paper aims at clarifying the main theoretical implications of this movement, through an analysis of the Menger‐Walras divide on money. This divide allows us to show new proof of the deep theoretical differences among the so‐called marginalist authors and of the richness of this historical period as a source for modern economics.

Suggested Citation

  • Andrés Alvarez & Vincent Bignon, 2010. "L. Walras and C. Menger: Two ways on the path of modern monetary theory," EconomiX Working Papers 2010-25, University of Paris Nanterre, EconomiX.
  • Handle: RePEc:drm:wpaper:2010-25
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    References listed on IDEAS

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    1. Michael Latzer & Stefan W. Schmitz (ed.), 2002. "Carl Menger and the Evolution of Payments Systems," Books, Edward Elgar Publishing, number 2630.
    2. Ricardo Lagos & Randall Wright, 2007. "When is Money Essential? A Comment on Aliprantis, Camera and Puzzello," Levine's Bibliography 122247000000001815, UCLA Department of Economics.
    3. Pascal Bridel, 1997. "Money and General Equilibrium Theory," Books, Edward Elgar Publishing, number 1303.
    4. Alain Béraud & Gilbert Faccarello, 2000. "Nouvelle histoire de la pensée économique, tome 3," Post-Print halshs-00201476, HAL.
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    Cited by:

    1. Eduard Braun, 2015. "Carl Menger’s Contribution to Capital Theory," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 23(1), pages 77-100.

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