Economists Can’t Define ‘Money’

Money, so they say, is the root of all evil today.

Arnold Kling challenges co-blogger Bryan Caplan to define “money.”   Tyler Cowen declines to take the challenge, which he thinks is “pure semantics,” but is pretty sure money exists.

At any rate, it’s no surprise that they’re giving none away.

UPDATE: In the comments below, Sean Hackbarth correctly assumes that I’m being glib.  There are a whole lot of concepts that everyone pretty much understands but that are damned near impossible to define with scholarly precision.   At least, in this case, the scholars aren’t making the leap that the thing therefore doesn’t exist, as some have done with race.

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James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College. He's a former Army officer and Desert Storm veteran. Views expressed here are his own. Follow James on Twitter @DrJJoyner.


  1. john personna says:

    At any rate, it’s no surprise that they’re giving none away.

    A Federal Funds Rate of 0.25 percent is pretty close.

    (I think once you get used to “price” being an arbitrary agreement, and “value” being a fiction, it’s not hard to step to money being another consensus concept. NPR had a story on the rise of local currencies in Germany, as a protest against the Euro. Case in point.)

  2. john personna says:

    As I wander over to zero hedge I see more about free money:

    Our foolish fearless financial leader gave a speech this week titled Restoring the Flow of Credit to Small Businesses. As near as I can tell the Chairman had little to offer those small businesses that were looking for some of that free money the Fed is doling out.

    It is on getting money to small business, and should interest those still seeking data on the administration’s “friendliness” to same.

    “Return on assets (ROA) declined by half, falling to 0.6 percent from 1.2 percent during the year-earlier period.”

    Yikes, that’s bearded Ben. He seems to be telling you something like what I’ve said recently here at OTB.

  3. Brummagem Joe says:

    It’s like quality Jim, hard to describe but you know what it is when you have it. On a more serious note did you see the CPI numbers? Core is still annualising at 0.9, maybe Krugman is right.

  4. James, I assume you’re being glib. They’re talking about a technical definition that can be quantified and fit into mathematical economic models. A basic economics intro course can define money in a general and subjective manner. And if you’re a critic of mathematical economic models that might be good enough.

  5. Pete says:

    Money? Read Jude Wanniski’s “The Way The World Works” for a clear understanding of money.