Adam Smith (1723-1790) on money

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Chapter 3 in The Political Economy and Feasibility of Bitcoin and Cryptocurrencies, 2022, pp 13-34 from Edward Elgar Publishing

Abstract: Smith continues and elaborates upon the dominant tradition that money comes from barter and its original function or goal was to overcome the difficulties in bartering; that money is originally a good which has real value and is coined and stamped. He discusses and defends the then new system of fractional reserve banking, with paper money backed up by commodity money; and claims that interest comes from the lending out of stock. What we would now call expansionary monetary and fiscal policy has no positive attributes - only negative ones. Government should be involved with supervising the quality of money, not its quantity. From the point of view of bitcoin and cryptocurrency advocates, this position is great. Blockchain technology can potentially supervise the quality of money better than government; liberate, free money from government.

Keywords: Economics and Finance (search for similar items in EconPapers)
Date: 2022
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