Rehme, Günther (2018)
On ‘Rusting’ Money Silvio Gesell’s Schwundgeld Reconsidered.
Report, Erstveröffentlichung
Kurzbeschreibung (Abstract)
Silvio Gesell hypothesized that money depreciation is economically and socially beneficial, ideas that have often been contended. Here I analyze that in a Sidrauski model in which households additionally have a ‘love of wealth’-motive. It is shown Gesell’s claims may be valid in a demand-determined, short-run equilib- rium and why money depreciation overcomes the zero lower bound on nominal interest rates. However, for a typical long-run equilibrium introducing money de- preciation in isolation may be bad. But money depreciation, when coupled with expansionary monetary policy, is a necessary condition for a positive Mundell- Tobin effect on long-run real variables and so creates wealth in the model. It is found that this also holds in the transition to the long-run equilibrium. Hence, the spirit of Gesell’s hypotheses can be verified for a plausible, long-run environment.
| Typ des Eintrags: | Report |
|---|---|
| Erschienen: | 2018 |
| Autor(en): | Rehme, Günther |
| Art des Eintrags: | Erstveröffentlichung |
| Titel: | On ‘Rusting’ Money Silvio Gesell’s Schwundgeld Reconsidered |
| Sprache: | Englisch |
| Publikationsjahr: | 25 Juni 2018 |
| Ort: | Darmstdt |
| Reihe: | Darmstadt Discussion Papers in Economics |
| Band einer Reihe: | 233 |
| URL / URN: | http://tuprints.ulb.tu-darmstadt.de/7538 |
| Kurzbeschreibung (Abstract): | Silvio Gesell hypothesized that money depreciation is economically and socially beneficial, ideas that have often been contended. Here I analyze that in a Sidrauski model in which households additionally have a ‘love of wealth’-motive. It is shown Gesell’s claims may be valid in a demand-determined, short-run equilib- rium and why money depreciation overcomes the zero lower bound on nominal interest rates. However, for a typical long-run equilibrium introducing money de- preciation in isolation may be bad. But money depreciation, when coupled with expansionary monetary policy, is a necessary condition for a positive Mundell- Tobin effect on long-run real variables and so creates wealth in the model. It is found that this also holds in the transition to the long-run equilibrium. Hence, the spirit of Gesell’s hypotheses can be verified for a plausible, long-run environment. |
| URN: | urn:nbn:de:tuda-tuprints-75388 |
| Zusätzliche Informationen: | Economic Performance, Depreciating Money, Zero Lower Bound, Demonetization, Love of Wealth |
| Sachgruppe der Dewey Dezimalklassifikatin (DDC): | 300 Sozialwissenschaften > 330 Wirtschaft |
| Fachbereich(e)/-gebiet(e): | 01 Fachbereich Rechts- und Wirtschaftswissenschaften 01 Fachbereich Rechts- und Wirtschaftswissenschaften > Volkswirtschaftliche Fachgebiete 01 Fachbereich Rechts- und Wirtschaftswissenschaften > Volkswirtschaftliche Fachgebiete > Fachgebiet Wirtschaftstheorie |
| Hinterlegungsdatum: | 15 Jul 2018 19:57 |
| Letzte Änderung: | 15 Jul 2018 19:57 |
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