A Praxeological Critique of the Equation of Exchange and Neutrality of Money

Tags: Monetary Theory, Economic Policy, Monetary Policy, Money and Banks

02/08/2025 Michael Njoku

No macroeconomics or monetary theory course is complete without introduction of the Equation of Exchange, or MV = PQ. However, this equation explains nothing, praxeologically speaking. Instead, it clouds our understanding of how money fits into our economy.

Original article: A Praxeological Critique of the Equation of Exchange and Neutrality of Money

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