4. The Position of Money among Economic Goods

Karl* Knies has recommended to replace the traditional division of economic goods into consumer goods and producer goods with a threefold classification: producer goods, consumer goods, and means of exchange.1 Terminological questions of this kind, however, should be decided solely on the basis of their usefulness for furthering scientific work; definitions, concepts, and the taxonomy of phenomena have to prove their usefulness in the results of the research which makes use of them. When these criteria are applied to the classification and terminology suggested by Knies, it becomes apparent that they are extremely appropriate. Indeed, there is no theory of 2 catallactics which does not make use of them. The theory of the value of money is always reserved for special treatment and separated for the explanation of the price formation of producer goods as well as consumer goods, although it is obviously part of a uniform theory of value and price. Even if we do not use the Kniesian terminology and classification consciously, in all significant discussions we act as if we had adopted them completely.

But it is also necessary to note that the special role of money among economic goods has, if anything, been over-emphasized. The problems of the determination of the purchasing power of money have mostly been treated as if they had nothing or very little in common with the problems of non-monetary exchange. This led to a special status of monetary theory and has been detrimental to the development of economic understanding. Even today, we continually encounter attempts to defend certain unjustified peculiarities of monetary theory.

Roscher’s often quoted remark, “[that] the wrong definitions of money can be divided into two main groups: Those which think of it as more and those which think of it as less than the most saleable good,”3 applies not only to the question of the definition of money. Even a number of those who consider the theory of money a part of catallactics go too far in emphasizing its special position. This branch of our science offers plenty of difficulties and it is not necessary to construct artificial problems; the existing ones provide enough challenge.

I. Monetary Services and the Value of Money

It is clear that the naive conception of the layman that things have value in themselves, i.e., intrinsic value, necessarily leads to a position which draws the dividing line between money and money substitutes differently from the position according to which the value of a thing is derived from its usefulness. Those who conceive of value as the result of properties inherent in things must necessarily make a distinction between physically valuable money and means of exchange which provide monetary services but are without material value. This approach inescapably leads to a contrasting of normal money with bad and abnormal money, which, in reality, is not money at all.

Today there is no need to deal with this theory. For the modern subjective theory of value, the question has long been decided. No one would still openly defend a concept according to which the whole or a portion of value and price theory was based upon intrinsic exchange value, i.e., independent of the valuations of acting men. Once this is admitted, one has already adopted the fundamental principle of subjective value theory, i.e., the theory of marginal utility.

For prescientific economists—the predecessors of the Physiocrats and the Classical Economists—it was a significant problem to integrate the theory of the value of money with that of the value of other goods. Holding a crudely materialistic bias, they saw the source of value in the “objective” usefulness of goods. From this point of view, it is obvious why bread, which can still hunger, and cloth, which can protect from the cold, will have value. But from where does money, which can neither nourish people nor keep them warm, derive its value? Some responded that it arose “from convention” and others maintained that the value of money was “imaginary.”

The error in this view was discovered early. John Law had put it most succinctly. If all value is derived from usefulness, then it must be true that the adoption of the precious metals as means of exchange must generate a value for it. If one wishes to call the value of the metal used as money, insofar as it is derived from its monetary services, imaginary, one has to regard all value as imaginary,

Car aucune chose n’a de valeur que par l’usage auquel on l’applique, et a raison des demandes qu’on en fait, proportionellement a sa quantite.4

With these words, Law anticipated the subjective theory of value; he should not be denied the place he deserves in the history of our science. The importance of his accomplishment is not reduced by his inability to develop all the implications from his fundamental idea or that he got lost in the impenetrable thicket of error or, perhaps, even of guilt.

Researchers who came after him were also unable to make full use of the content of the clearly developed fundamental idea advanced by Law. In three respects we still encounter misconceptions.

First, some writers categorically deny that the service provided by money can generate value. Unfortunately, they do not provide a justification why monetary services should be different from the services provided by food and clothing. The difficulty posed by “paper money” is circumvented by viewing “paper money” as a claim on genuine, i.e., “materially” valuable, metallic money. Fluctuations in the rate of exchange of “paper money” are explained by changes in the probability of payment in species. In view of the development of monetary theory during the last decades, I consider it superfluous to challenge this theory. I have attempted an empirical refutation and have not encountered adequate opposition.5

In a way, the second error is connected with the first: the denial of the possibility of there being a money whose “substance” only produces monetary services and nothing else. It is usually granted that monetary services can generate value, just as every other service, in general. Without reservation, we have to agree with Knies when he argues, “[that] gold and silver would have been as unsuitable for the purpose of performing the functions of money as any other commodity, if they had not previously—before their adoption for monetary services—served as economic goods for the satisfaction of human wants, a ‘general’ economic need, a need that was widely felt and persistent.”6 But Knies is in error when he continues, “it is not sufficient that this primary use of the precious metals has preceded their use for monetary services; it is necessary that this use continues, lest the pieces of precious metal loose their usefulness as money. ... If people ceased to use gold and silver to satisfy their desire for jewelry or ornamentation, etc., then the other use of the precious metals, their use as a means of exchange, would be eliminated, also.”7 Knies did not succeed in proving the validity of this assertion. It is by no means evident why an economic good, which performs the services of a commonly used means of exchange, should loose its ability to serve as money simply because its use for other purposes are gradually discontinued.

That the adoption of a good as a medium of exchange requires the goods’ previous use or consumption for other purposes results from the fact that the specific demand for its services as a means of exchange presupposes an already existing objective exchange value. This objective exchange value, which subsequently will be modified by the demand for the good as a medium of exchange in addition to the demand for it in its “other” use, will be based exclusively upon its “other” use when it begins to be used as a means of exchange. But once an economic good has become money, then the specific demand for money can tie into an already existing exchange relationship between money and goods in the market, even if the demand for the money-good, as motivated by the other use, disappears.

Only very slowly and with difficulty has the human spirit freed itself from the crude materialistic mode of thought that has resulted in a prolonged resistance to the idea that the use of a good as a medium of exchange, like any other possible use for the good, generates a demand that establishes a price and is capable of changing that price. If the ability of a thing to satisfy a human need, as well as the recognition of this ability, are made the prerequisites for establishing the goods-quality of a thing,8 then one comes close to distinguishing between “real” and “unreal” goods among the objects of economic action. As soon as the economist steps upon this ground, he looses his footing and slides unintentionally out of the domain of scientific objectivity; he enters the realm of ethical valuations, morality, and policy. There, he will compare the “objectively useful” things to those which are merely “thought to be useful.” He will examine whether and to what extent the things which are thought to be useful (and therefore are treated accordingly) are indeed so in an “objective” sense. As soon as one has come this far, it is only logical to ask whether the usefulness provided by a good satisfies a genuine need or merely a fictitious one. This way of thinking may subsequently lead to the view that the value of precious metals (which serve “only” the desire for jewelry and do not satisfy a physiological need as e.g., food and clothing undeniably do from a crude materialistic point-of-view) is entirely imaginary, a result of inappropriate social institutions and human vanity. On the other hand, the result can be that the value of precious metals is admitted as legitimate since even the desire for jewelry is “genuine” and “justified.” The objective utility of the precious metals is not denied; rather, the general validity of the requirement for the services of money is questioned since society had once existed without money and, in any case, such a society is imaginable. It is an untenable assumption that the “goods-quality” requires a “natural” utility not limited to the particular requirements of any presupposed social order.

But an even cruder materialism was the view which wanted to deny monetary services their value-creating power because money in its performance of this service did not loose its ability to serve other purposes; in other words, because its “substance” was not used up in its services as money.

All of those who denied the ability of the services of money to determine its exchange value failed to recognize that the only decisive element is demand. The fact that there exists a demand for money—the most marketable (most saleable) good, for which the owners of other goods are prepared to exchange—means that the monetary function is capable of creating value.

II. Money Supply and Money Demand: The “Velocity of Circulation” of Money

The most disastrous of the unjustified deviations of monetary theory from the theory of direct exchange was the failure to base the analysis of the fundamental problem of the theory of the value of money on the relation between the stock of money and the demand for it by the individual economic units, or between the demand for money and the supply of money on the market. Rather, the analysis began with the objective usefulness of the monetary unit for the aggregate economy, which was expressed as the velocity of money relative to the money stock and which was then compared to the sum of transactions.

The old tendency, taken over from the Cameralists,9 to base the analysis of economic problems of the “national economy,” on the “totality” and not on the acting human subjects, seems hard to eradicate. In spite of all the warnings of the subjective economists, we continue to observe relapses. It is one of the lesser evils that ethical judgments regarding phenomena are presented under the guise of scientific objectivity. For example, productive activity (i.e., activity carried out in an imagined socialist community led by the critic) is contrasted with profit-seeking activity (i.e., the activity of individuals in a society based on private property in the means of production). The former will be viewed as the “just” and the latter as the “unjust” mode of production. Much more important is the fact that if one thinks in terms of the totality of a society’s economy, one can never understand the operation of a society based on private property in the means of production. It is erroneous to maintain that the necessity for the collectivist method can be proved by showing that actions of the individuals can only be understood within the framework of that individual’s environment. This is so because economic analysis does not depend on the psychological understanding of the motives of action, but only an understanding of action itself. It is unimportant for catallactics why bread, clothes, books, cannons or religious items are desired on the market; it is only important that a certain demand does exist. The mechanism of the market and, therefore, the laws of the capitalistic economy can only be grasped if one begins with the forces operating on the market. But on the market there are only individuals acting as buyers and sellers, never the “totality.” In economic theory, the totality can be taken only in the sense of an economic collective where the means of production are entirely outside the orbit of exchange and, therefore, cannot be sold for money. Here there is neither room for price theory nor a theory of money. But if we wish to grasp the value problems of a collective economy, we can—ironically—only use that method of analysis which has come to be known as the “individualistic method.”

The attempts to solve the problem of the value of money with reference to the aggregate economy, rather than through market factors, culminated in a tautological equation without any epistemological value. Only a theory which shows how subjective value judgments of buyers and sellers are influenced by changes in the different elements of the equation of exchange can legitimately be called a theory of the value of money.

Buyers and sellers on the market never concern themselves with the elements in the equation of exchange, of which two—velocity of circulation and the price level—do not even exist before market parties act and the other two—the quantity of money (in the whole economy) and the sum of transactions—could not possibly be known to the parties in the market. Only the importance which the various actors in the market attach, on the one hand, to the maintenance of a cash balance of a certain magnitude and, on the other hand, to the ownership of the various goods in question determines the formation of the exchange relationship between money and goods.

Connected with the concept of the velocity of circulation of money is the mental image that money generates its usefulness only at the instant of transaction, but is “idle” and useless at other times. A distinction between active and idle money is also made when one speaks of money hoarding and proceeds to a comparison between the “hoarded” quantity of money and the quantity of money that would be necessary to perform the monetary services; what distinguishes this from the previous case is the way in which the boundary between active and idle money is drawn. Both distinctions must be rejected.

The service of money is not confined to transactions. It fulfills its task not only at the moment it passes from one hand to the next. It also performs services when it rests in the till, as the most marketable good, in anticipation of its future use in trade as a generally used means of exchange. The demand for money of individuals, as well as the entire economy, is determined by the desire to maintain a cash balance and not by the aggregate of transactions to be carried out during a certain time period.10

It is an arbitrary procedure to divide the money stock into two parts: that which is designated to perform money services proper and that which serves as a money hoard. Of course, no damage will be done if, on the one hand, the demand for money is separated into a demand for hoarding and a demand to perform the monetary service proper. But a formula which portrays and solves only an arbitrarily delineated part of the problem must be rejected if we are able to show another one which will deal with and solve the whole problem in a uniform fashion.

III. Fluctuations in the Value of Money

One of the most peculiar phenomena in the history of monetary theory is the stubborn resistance encountered by the quantity theory. The imperfect formulation given to it by many of its advocates inevitably ran into opposition, with many—as, for example, Benjamin Anderson11 —ascribing to the concept a meaning quite different from that commonly accepted. As a result, what they call the quantity theory, and oppose as such, is not the theory itself but only a variation of it. This is not particularly astonishing. But what is quite surprising is that an attempt was made and sometimes is still made today to deny that changes in the relation between money supply and money demand will modify the purchasing power of the monetary unit. It is not sufficient to base an explanation on the special interests of inflationists, statists and socialists, of civil servants and politicians who would be harmed by a spreading of knowledge concerning monetary policy. We will never arrive at an answer by following the path of the Historical-Realistic School, which (following the Marxian example) explains all ideas by ideologies. It had never been a problem to explain why a particular ideology is developed and advocated by certain classes who believe they can benefit from it directly (even if this direct advantage is more than outweighed by indirect disadvantages). What has to be explained, however, is rather how incorrect theories come about and find followers. How does it come about that many people, without justification, come to assume that a certain policy benefits either the entire society or many groups in that society?

However, the theory of money as such is not interested in these psychological aspects which explain the reasons for the unpopularity of the quantity theory and the tendency to adopt other explanations for the value of money. Rather, it is interested in the question: which elements of the doctrines opposing the quantity theory could be useful? Since it was equally inadmissible to deny the importance of changes in supply for the formation of exchange relations in the area of indirect exchange as it was in the area of direct exchange, one could oppose the quantity theory only by admitting its correctness in principle, but arguing that notwithstanding its general validity another principle would regularly eliminate its effectiveness. This attempt was made by the Banking School with its famous theory of hoarding, and its offshoot, the theory of the automatic adjustment of the circulation of money substitutes to the demand for money in the broader sense. Today, both theories are overthrown.

As is the case with so many theories, the advocates of the quantity theory have harmed it more than its enemies. We have already mentioned the inadequacy of those theories based on the concept of the velocity of circulation of money. It was not any less erroneous to interpret the quantity theory as saying that the changes in the quantity of money resulted in proportional changes in the prices of goods. It was overlooked that every change in the relationship between the supply of money and the demand for money would necessarily bring about a shift in the distribution of wealth and income and that, therefore, the prices of the different goods and services could not be effected proportionally and simultaneously.

Nowhere has the practice of working with formulas modeled after mechanics, instead of paying attention to the problem of the influence of market factors, taken a greater toll than in this case. Economists wanted to operate with the equation of exchange without noticing that the changes in the volume of money and the demand for money can come about in only one way: at first, the evaluations and with them the actions of only a few economic subjects will be influenced, with the resulting changes in the purchasing power of the monetary unit only spreading through the economy in a step-by-step pattern. In other words, the problem of changes in the value of money have been treated with the method of “statics,” although there should never have been any doubt concerning the dynamic character of the problem.

IV. Money Substitutes

The most difficult and most important special problem of monetary theory is that of money substitutes. The fact that money services can also be rendered by secure money claims redeemable on demand, presents considerable difficulties to the monetary theorists’ attempt to define the supply of money and the demand for money. This difficulty could not be overcome as long as money substitutes were not clearly defined and separated into money certificates and fiduciary media, in order to treat the granting of credit through the issue of fiduciary media separately from all other types of credit.

Loans which do not involve the issuing of fiduciary media (i.e., bank notes or deposits which are not backed by money) is of no consequence for the volume of money. The demand for money can be influenced by lending as much as by any other institution of the economic order. Without knowledge of the data of the specific case, we cannot say in which direction this influence will operate. The widely-held opinion that an expansion of credit will always lead to a reduction in the demand for money is not correct. If many of the loan contracts provide for large repayments on certain days (for example, at the end of the month or quarter), the result will be an increase and not a reduction in the demand for money. The consequences of this increase in the demand for money will be expressed in prices, if it were not for clearing arrangements, on the one hand, and the practice of banks to increase the volume of fiduciary media on critical days, on the other hand.

Everything depends on the clear separation of money from money substitutes and within the category of money substitutes a distinction between money certificates (a money substitute fully backed by money) and the fiduciary medium (the money substitute not backed by money). But this is above all a question of terminological appropriateness. However, this question gains in importance in view of the difficulty and complexity of the problems. It is not—as so often is still maintained—the “granting of credit” but the issuing of fiduciary media which causes those effects on prices, wages, and interest rates, which banking theory has to deal with. It is, therefore, not inappropriate to refer to banking theory as the theory of fiduciary media.

V. Economic Calculation and the Problem of “Value Stability”

The old and widely accepted conception of money as a measure of price and value is out of the question for modern theory. But it was not an entirely harmless oversight of the subjective theory that it has not paid more attention to the importance of money for economic calculation, as well as the problem of economic calculation in general.

Traditionally, theoretical economics separates the theory of unintermediated (direct) exchange from the theory of intermediated (indirect) exchange. This division of catallactics is indispensible and without it, it would have been impossible to ever produce useful results. But one must always be aware that the assumption that economic goods are exchanged without the intermediation of a generally used means of exchange is realistic only for the cases involving the exchange of consumer goods and those producer goods of the lowest order, i.e., those closest to consumer goods. The direct exchange of consumer goods and closely related producer goods is, of course, possible; it exists today and did so in the past. However, the exchange of goods of a more remote order presupposes the use of money. The concept of the market as the essence of coordination of all elements of demand and supply, upon which modern theory does and must depend, is unthinkable without the use of money. Only with the use of money is it possible to compare the marginal utility of goods in all alternative employments. Only where money exists can we clearly analyze the difference in value between present and future goods. Only within a money economy can this value difference be comprehended in the abstract and separated from changes in the valuation of individual concrete economic goods. In a barter economy, the phenomenon of interest could never be isolated from the evaluation of future price movements of individual goods. To assume the existence of a highly developed market system without the intermediation of a generally accepted means of exchange would be a scientific fiction like Vaihinger’s “as if” theory.12

We will not deal here with the significance of monetary calculation for rational action and social cooperation; this is not a task for catallactics but one for sociology. The field of monetary theory is large enough if it confines itself to an exhaustive treatment of questions of its own immediate concern.

The paramount role of money within the sphere of economic goods was established by the practice of calculating in terms of money, by expressing the price of all other economic goods in terms of the corresponding amount of money and by basing economic decisions solely on the value of the monetary unit. One result of this practice is the contrast between money and goods as we encounter it in the phrase “the high cost of living” and even more clearly in mercantilist theory. But a more serious consequence of assigning such prominence to money has been the development of the idea of a “stable value” of money, which in spite of its naivete and vagueness has been a permanent influence on monetary policy.

As it came to be recognized that money is not of “stable value,” the political postulate arose that money should be of stable value or at least be designed in such a way that it would approximate this ideal as closely as possible. The advocates of the gold standard, as well as those of the bimetallic standard, have touted their monetary systems as the best guarantee for the greatest possible stability of the value of money. A number of proposals are based on the idea that the greatest possible constancy of the purchasing power of money is the ultimate and the most important goal of monetary policy. One such proposal foresees the creation of a commodity currency (tabular standard) for long-term contracts to supplement precious metal currency. The proposals by Irving Fisher13 and John Maynard Keynes14 go even farther by recommending a “manipulated currency” based on a system of index numbers.

The shortcomings of the “stable value” notion and the contradictions in a monetary policy based upon it do not have to be shown again.15 In everyday life, the actions of economizing subjects regarding value estimates usually cover only short periods of time, if we ignore for the moment long-term loan contracts with which we will have to deal in more detail later. The economic calculations of the entrepreneur is confined to the months and years ahead. Only conditions in the immediate future can be forecasted and considered in economic calculations. Apart from the difficulties which changes in the purchasing power of money present, it would be impossible to forecast the economic situation of a more distant future with any degree of reliability.

The desire for a “stable” store of purchasing power originated with attempts to protect wealth and income from the vicissitudes of the market. The goal was to maintain wealth and income for “eternity.” The agrarian mentality thought it had found such a store of wealth in the form of land. Land would always be land, and the fruits of agriculture would always be desirable; thus, it was believed that the ownership of land was a form of wealth which would assure a steady income. It is easy for us today, in an age of capitalistically organized agriculture, to show the error of this view. A self-sufficient farmer working on his own land might be able to insulate himself “forever” from the changes taking place around him. But for a business operating in a society based on an extensive division of labor, the situation is quite different. Capital and labor must only be applied to the best plots of land. To produce on land of lesser quality fails to yield any net returns. Even plots of land can fall drastically in value or lose it altogether when higher quality land becomes available in large amounts.

This type of thinking was soon transferred from land to claims secured by property in land. Later claims against the “State” and other creatures of public law were added to the secured claims. The State was thought to have eternal existence and its promises to pay were accorded unconditional faith. Consequently, government bonds appeared as a means to remove wealth and income from the uncertainties of life into the sphere of “eternity.” We need not waste any more words on the fallacy of this idea. It is sufficient to point out that even States can fall and that States repudiate their debts.

Contrary to prevailing opinion, in the capitalistic social order no wealth exists which automatically produces a return. In order to derive income from property in the means of production, property has to be either employed in a successful venture or has to be loaned to a promising entrepreneur. But for entrepreneurs, success is never “certain.” It can happen that a firm will decline and the capital invested vanishes, either partly or entirely. The capitalist who is not an entrepreneur himself, but merely lends to entrepreneurs, is less exposed to the danger of loss than is the entrepreneur; but even he bears the risk that the loss of the entrepreneur becomes so substantial that he is unable to repay the borrowed capital. Ownership of capital is not the source of automatically accruing income but a means whose successful application can produce income. To derive income from property in capital, one has to have the ability to invest it advantageously. He who does not have this ability, cannot count on income from his capital ownership and my loose it entirely.

To reduce these difficulties and uncertainties to the lowest possible level, capitalists acquire land, government obligations and mortgage bonds. But here the shortcomings of a money lacking “stable value” begins to cause problems. In the case of short-term credit, the effects of changes in the purchasing power of money on the value of the claim will be eliminated or at least reduced by the fact that market interest rates for short-term loans will rise and fall with the fluctuations in the prices of goods. This adjustment is not possible in the case of long-term loans.

The ultimate reason behind the striving for money of a “stable value” is to be found in the desire to create a medium capable of removing the ownership of capital from the domain of the temporal into the domain of the eternal. But the solution to the problem of value stability can only be accomplished if all movement and change is eliminated from the economic system. It is not sufficient to stabilize the exchange relationship between money and an average of commodity prices; one would also have to fix the exchange ratios between all goods.

If monetary policy abstains from everything which could cause violent changes in the exchange relationship between money and other economic goods which originate from the “money side”; if it chooses a commodity currency which is not subject to sudden fluctuations in value stemming either from its own supply or from its demand for industrial and other non-monetary uses; if it exercises restraint in the issue of fiduciary media: then it has done everything that can be done towards a mitigation of the harmful effects that flow from changes in the purchasing power of money. If monetary policy were confined to these tasks, it would contribute more to the elimination of these perceived evils than by conscious efforts to realize an unreachable ideal. No one who understands the meaning and implications of the theoretical concept of a “stationary state” can deny that all attempts to transplant this conceptualization from the world of economic theory into real life must remain unsuccessful.

• *[Originally published in Die Wirtschaftstheorie der Gegenwart vol. 2, Hans Mayer, Frank A. Fetter, and Richard Reisch, eds. (Vienna: Julius Springer, 1932). Translated for this volume by Albert H. Zlabinger—Ed].
• 1Karl Knies, Geld und Kredit, 2nd ed. (Berlin: Weidmann, 1885), pp. 20ff.
• 2[Catallactics is that part of praxeology that deals specifically with market phenomena. The term was first used by Bishop Richard Whately in his Introductory Lectures in Political Economy (1831)—Ed.]
• 3Wilhelm Röscher, Grundlagen der Nationalökonomie, 25th ed. (Stuttgart and Berlin: J. G. Cotta’sche Buchhandlung Nachtfolger, 1918), p. 340.
• 4John Law, Considerations sur le Numeraire et le Commerce (Paris: Buisson, 1851), pp. 447ff. The passage translates as: The value of a thing is only in the use we make of it and the expectations we put into it, proportional to its quantity.
• 5See Mises, The Theory of Money and Credit, 2nd ed. (Indianapolis,Ind.: Liberty Classics, 1981), pp. 146-53.
• 6Knies, Geld und Kredit, p. 322.
• 7Ibid., pp. 322ff.
• 8This is even done by Menger; see, his Principles of Economics [1871] (New York: New York University Press, 1981), pp. 52–53.
• 9[The Cameralist school, in the countries of central Europe during the seventeenth and eighteenth centuries advocated a total paternalistic state. Their program centered on how best to regulate industry, trade, and fiscal matters to fund the growing military and administrative state. The school held the basic tenants of mercantilism, advocated the dissolution of the guild system, and standardization of laws—Ed.]
• 10Also see, Edwin Cannan, Money, 4th ed. (Westminister: P. S. King and Son, 1932), pp. 72ff.
• 11Benjamin Anderson, The Value of Money (New York: Macmillan, 1917).
• 12[Hans Vaihinger (1852–1933) was a German philosopher who maintained that “An idea whose theoretical untruth or incorrectness, and therewith its falsity, is admitted, is not for that reason particularly valueless and useless; for an idea in spite of its theoretical nullity may have great practical importance,” The Philosophy of “As If,” C. K. Odgen, trans. (New York: Harcourt, Brace, 1935), p. viii—Ed.]
• 13Irving Fisher, Stabilizing the Dollar (New York: Macmillan, 1925), pp. 79ff.
• 14John Maynard Keynes, A Tract on Monetary Reform (London: Macmillan, 1923), pp. 177ff.
• 15[Ludwig von Mises, Monetary Stabilization and Cyclical Policy (1928), in On the Manipulation of Money and Credit, Percy L. Greaves, Jr., ed. (Dobbs Ferry, N.Y.: Free Market Books, 1978), pp. 83-103—Ed.]