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Would a State Monopoly over Money Creation Allow for a Reduction of National Debt? A Study of the “Seigniorage Argument” in Light of the “100% Money” Debates

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  • Samuel Demeulemeester

    (TRIANGLE - Triangle : action, discours, pensée politique et économique - ENS de Lyon - École normale supérieure de Lyon - UL2 - Université Lumière - Lyon 2 - IEP Lyon - Sciences Po Lyon - Institut d'études politiques de Lyon - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - CNRS - Centre National de la Recherche Scientifique)

Abstract

This chapter discusses the "seigniorage argument" in favor of public money issuance, according to which public finances could be improved if the state more fully exercised the privilege of money creation, which is, today, largely shared with private banks. (...)

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  • Samuel Demeulemeester, 2020. "Would a State Monopoly over Money Creation Allow for a Reduction of National Debt? A Study of the “Seigniorage Argument” in Light of the “100% Money” Debates," Post-Print hal-02495683, HAL.
    • Handle: RePEc:hal:journl:hal-02495683
    DOI: 10.1108/S0743-41542020000038A010
    Note: View the original document on HAL open archive server: https://hal.science/hal-02495683
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    References listed on IDEAS

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    1. James W. Angell, 1935. "The 100 Per Cent Reserve Plan," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 50(1), pages 1-35.
    2. Franziska Schobert, 2003. "Euroisation. Assessing the Loss of Seigniorage and the Impact on the Interest Premium in Central European Countries," Revue économique, Presses de Sciences-Po, vol. 54(5), pages 913-935.
    3. Henry C. Simons, 1936. "Rules versus Authorities in Monetary Policy," Journal of Political Economy, University of Chicago Press, vol. 44, pages 1-1.
    4. Carl E. Walsh, 2010. "Monetary Theory and Policy, Third Edition," MIT Press Books, The MIT Press, edition 3, volume 1, number 0262013770, December.
    5. Giuseppe Fontana & Malcolm Sawyer, 2016. "Full Reserve Banking: More ‘Cranks’ Than ‘Brave Heretics’," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 40(5), pages 1333-1350.
    6. Friedman, Milton, 1971. "Government Revenue from Inflation," Journal of Political Economy, University of Chicago Press, vol. 79(4), pages 846-856, July-Aug..
    7. Samuel Demeulemeester, 2018. "The 100% money proposal and its implications for banking: the Currie–Fisher approach versus the Chicago Plan approach," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 25(2), pages 357-387, March.
    8. Allen, William R, 1993. "Irving Fisher and the 100 Percent Reserve Proposal," Journal of Law and Economics, University of Chicago Press, vol. 36(2), pages 703-717, October.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Chicago Plan; Seigniorage; Irving Fisher; Public Debt; Money Creation; 100% Money;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E69 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Other
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • H69 - Public Economics - - National Budget, Deficit, and Debt - - - Other

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