IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-01397044.html

Banks as accelerators of the circulation of money

Author

Listed:
  • Laurent Le Maux

    (LED - Laboratoire d'Economie Dionysien - UP8 - Université Paris 8)

Abstract

The money multiplier approach asserts that banks are unique in that they implement a creation of money, while the finance approach regards banking institutions as financial intermediaries among others. In retrospect, Cantillon's Essai stands between these two extreme approaches. It both challenges the money multiplier approach and grants to banks a significant monetary role. The aim of the paper is to clarify Cantillon's theoretical propositions on bank issuing of debts convertible on demand into money at face value and to explore further the proposition according to which banks contribute to accelerating the circulation of money.

Suggested Citation

  • Laurent Le Maux, 2015. "Banks as accelerators of the circulation of money," Post-Print hal-01397044, HAL.
    • Handle: RePEc:hal:journl:hal-01397044
    DOI: 10.1057/eej.2014.75
    Note: View the original document on HAL open archive server: https://hal.science/hal-01397044v1
    as

    Download full text from publisher

    File URL: https://hal.science/hal-01397044v1/document
    Download Restriction: no
    File URL: https://libkey.io/10.1057/eej.2014.75?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Neil T. Skaggs, 1991. "John Fullarton's Law of Reflux and Central Bank Policy," History of Political Economy, Duke University Press, vol. 23(3), pages 457-480, Fall.
    2. Laurent Le Maux, 2014. "Cantillon And Hume On Money And Banking: The Foundations Of Two Theoretical Traditions," Journal of Economic Surveys, Wiley Blackwell, vol. 28(5), pages 956-970, December.
    3. Fama, Eugene F., 1980. "Banking in the theory of finance," Journal of Monetary Economics, Elsevier, vol. 6(1), pages 39-57, January.
    4. David Glasner, 1992. "The Real-Bills Doctrine in the Light of the Law of Reflux," History of Political Economy, Duke University Press, vol. 24(4), pages 867-894, Winter.
    5. Williams, Jeffrey C, 1984. "Fractional Reserve Banking in Grain," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 16(4), pages 488-496, November.
    6. Laurent Le Maux, 2012. "The Banking School and the Law of Reflux in General," History of Political Economy, Duke University Press, vol. 44(4), pages 595-618, Winter.
    7. Maurice Allais, 1987. "The Credit Mechanism and its Implications," Palgrave Macmillan Books, in: George R. Feiwel (ed.), Arrow and the Foundations of the Theory of Economic Policy, chapter 18, pages 491-561, Palgrave Macmillan.
    8. Carl Wennerlind, 2005. "David Hume's Monetary Theory Revisited: Was He Really a Quantity Theorist and an Inflationist?," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 223-252, February.
    9. Bordo, Michael David, 1983. "Some aspects of the monetary economics of Richard Cantillon," Journal of Monetary Economics, Elsevier, vol. 12(2), pages 235-258.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Laurent Le Maux, 2014. "Cantillon And Hume On Money And Banking: The Foundations Of Two Theoretical Traditions," Journal of Economic Surveys, Wiley Blackwell, vol. 28(5), pages 956-970, December.
    2. Bordo, Michael D., 1986. "Explorations in monetary history: A survey of the literature," Explorations in Economic History, Elsevier, vol. 23(4), pages 339-415, October.
    3. Laurent Le Maux, 2021. "Bagehot for Central Bankers," Working Papers Series inetwp147, Institute for New Economic Thinking.
    4. Claudio Borio, 2019. "On money, debt, trust and central banking," BIS Working Papers 763, Bank for International Settlements.
    5. Marvin Goodfriend, 1991. "Money, credit, banking, and payments system policy," Economic Review, Federal Reserve Bank of Richmond, vol. 77(Jan), pages 7-23.
    6. Spahn, Peter, 2018. "Was war falsch am Merkantilismus?," Hohenheim Discussion Papers in Business, Economics and Social Sciences 26-2018, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    7. Simon Bilo, 2018. "Lucas and Hume on Monetary Non-neutrality: A Tension between the Logic and the Technique of Economics," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 44(3), pages 364-380, June.
    8. Bordo, Michael D & Redish, Angela, 1993. "Maximizing Seignorage Revenue during Temporary Suspensions of Convertibility: A Note," Oxford Economic Papers, Oxford University Press, vol. 45(1), pages 157-168, January.
    9. Mohammad Ataei & Soamayeh Naserian, 2015. "An Assessment Study on the Efficiency of Banks through Data Envelopment Analysis (DEA). Case Study: A Bank Based in Tehran," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 5(4), pages 105-110, October.
    10. Da Rin, Marco & Hellmann, Thomas, 2002. "Banks as Catalysts for Industrialization," Journal of Financial Intermediation, Elsevier, vol. 11(4), pages 366-397, October.
    11. Al-Jarhi, Mabid, 2014. "Towards an Economic Theory of Islamic Finance Regulation," MPRA Paper 66744, University Library of Munich, Germany, revised 2014.
    12. Michele Fratianni, 2017. "It is time to separate money banks from credit banks in Italy," Mo.Fi.R. Working Papers 138, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
    13. Enzo Dia, 2004. "Monopolistic Pricing in the Banking Industry: a Dynamic Portfolio Model," Finance 0411025, University Library of Munich, Germany.
    14. Fernando Tenjo & Enrique Lopez, 2003. "Credit bubble and stagnation in Colombia, 1990-2001," Colombian Economic Journal, Academia Colombiana de Ciencias Economicas, Colegio Mayor de Nuestra Senora del Rosario, Pontificia Universidad Javeriana, Universidad de Antioquia, Universidad de los Andes, Universidad del Valle, Universidad Externado de Colombia, Universidad Nacional de Colombia, vol. 1(1), pages 151-191, December.
    15. David Howden & Amadeus Gabriel, 2015. "The Interest Rate Brake on Maturity Transformation," Journal of Economic Issues, Taylor & Francis Journals, vol. 49(4), pages 1100-1111, October.
    16. Edgardo Barandiarán, 2000. "Chile Después del Peso: Viviendo con el Dólar," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 37(110), pages 241-267.
    17. Avkiran, Necmi K., 2006. "Developing foreign bank efficiency models for DEA grounded in finance theory," Socio-Economic Planning Sciences, Elsevier, vol. 40(4), pages 275-296, December.
    18. Ian R. Harper, 1988. "The SRD Requirement and Monetary Policy," The Economic Record, The Economic Society of Australia, vol. 64(3), pages 178-186, September.
    19. Frederick T. Furlong & Michael C. Keeley, 1986. "Bank regulation and the public interest," Economic Review, Federal Reserve Bank of San Francisco, issue Spr, pages 55-71.
    20. Walter, Timo, 2019. "Janus Face of Inflation Targeting_Walter_PrePrint," OSF Preprints 9fmhe, Center for Open Science.

    More about this item

    Keywords

    ;
    ;
    ;

    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:hal:journl:hal-01397044. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.