Franchise Finance: A Brief Exposition and Exposé

Robert C. Hockett ()
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Robert C. Hockett: Cornell University

Chapter Chapter 3 in The Citizens' Ledger, 2022, pp 33-47 from Springer

Abstract: Abstract This chapter describes in detail the system of hybrid finance found in all of today’s commercial republics, taking account both of the productive opportunities it enables and of the risks it entails. It models these systems as what the author long ago dubbed “franchise” arrangements, pursuant to which the public sector franchisor maintains the quality of the “product” it disseminates—public credit-money—through licensing and regulatory regimes, while consigning the distribution of this product to private sector “franchisee” institutions—banks and “shadow banks.” This system enables far more productive investment than would be possible under a system in which all finance capital had to be preaccumulate. But is also the source of colossally destructive asset price bubbles and busts.

Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-030-99566-9_3

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DOI: 10.1007/978-3-030-99566-9_3

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