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.
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.)
As I wander over to zero hedge I see more about free money:
It is on getting money to small business, and should interest those still seeking data on the administration’s “friendliness” to same.
http://www.zerohedge.com/article/bernanke-equipment-leasing
“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.
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.
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.
Money? Read Jude Wanniski’s “The Way The World Works” for a clear understanding of money.