The Credit Money, State Money, and Endogenous Money Approach: A Survey and Attempted Integration

Abstract

The primary purpose of this article will be to draw out explicitly the links among the state money, credit money, and endogenous money approaches, after first discussing the nature of money via historical and sociological analysis. The state money approach is associated with Knapp, Keynes, and Lerner, while the credit money approach is associated with Schumpeter and more loosely with the endogenous money approach. Innes provided an integration of the state money and credit money approaches, but his work was long forgotten. Post Keynesians (and to a lesser extent, Institutionalists) have participated in a modern revival of an endogenous money approach that was common in the nineteenth century, although most recent writers on the endogenous money approach have not explored links to the credit money and state money approaches. While this article did not trace the development of the endogenous money approach, it will show how it relates to the state money and credit money approaches. Keywords: credit money, state money, endogenous money, horizontalism, origins of money, nature of money. DOI: 10.7176/DCS/10-2-04 Publication date: February 29 th 2020