H Theory of Money Supply

XBKAVY AO JA@KY S[^^DY 

Xbk s{~~dy ao ja`ky s{~~dy is hkxkvji`kh mai`xdy fy xbk ja`kxgvy g{xbavixy$ fg`ls g`h xbk ~{fdic. Xbkvk is g hisxi`cxia` fkxukk` xua li`hs ao ja`ky= "g) Avhi`gvy ja`ky \JZ g`h "f) Bieb ~aukvkh ja`ky \BZ. J is hkoi`kh `gvvaudy gs xbk s{j ao c{vvk`cy g`h hkjg`h hk~asixs ao fg`ls \i`cd{hi`e xbk VFIZ bkdh fy xbk ~{fdic< g`h xbgx  si`ck ‒axbkv hk~asixs’ ao xbk VFI i`cd{hkh i` xbk jkgs{vk ao J gvk g kvy sjgdd ~va~avxia` \dkss xbg` a`k ~kv ck`xZ ao xbk xaxgd ja`ky s{~~dy ao J$ axbkv hk~asixs ao xbk VFI is ie`avkh oav xbkavkxicgd sij~dioicgxia`. Gccavhi`edy$ Gccavhi`edy$

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"7)

                 Bieb ~aukvkh ja`ky \BZ is ja`ky ~vah{ckh fy xbk VFI g`h xbk EaI \sjgdd cai`s i`cd{hi`e a`k v{~kk `axksZ g`h bkdh f y xbk ~{fdic g`h fg`ls. Xbk VFI cgdds B ‒Vkskvk Ja`ky’. B is xbk s{j ao  "i) c{vvk`cy bkdh fy xbk ~{fdic \CZ$ "ii) Cgsb vkskvks ao fg`ls \VZ$ g`h "iii) —Axbkv hk~asixs‚ ao xbk VFI \AHZ.

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"6)

 is cajja` xa faxb J g`h B g`h xbgx xbk a`dy hiookvk`ck fkxukk` xbk dgxxkv xua is h{k xa xbk skca`h caj~a`k`x ao kgcb$ `gjkdy HH i` J g`h V i` B. Xbis hiookvk`ck gvisks ovaj xbk ~vksk`ck ao fg`ls gs xbk ~vah{ckvs ao hkjg`h hk~asixs. F{x xa fk gfdk xa ~vah{ck HH$ fg`ls bgk xa jgi`xgi` V$ ubicb is g ~gvx ao B$ ~vah{ckh a`dy fy xbk ja`kxgvy g{xbavixy g`h `ax fy fg`ls xbkjskdks.  G.

XBK B XBKAVY AO JA@KY S[^^DY 

Gs g oivsx g~~varijgxia`$ ix is gss{jkh xbgx xbk s{~~dy ao B \B sZ is ~adicy hkxkvji`kh. Xbis gss{j~xia` eiks {s

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"3)

ubkvk xbk fgv gfak B sie`ioiks xbgx ix is eik` kraek`a{sdy xa xbk ~{fdic g`h fg`ls. Xbk g`gdysis ao xbk hkjg`h oav B \B hZ is j{cb javk ij~avxg`x oav xbk B xbkavy. Xbk lky i`siebx ao xbk xbkavy is xa vkdgxk ix HH av J. B is hkjg`hkh ~gvxdy fy xbk ~{fdic gs c{vvk`cy \CZ g`h ~gvxdy fy xbk fg`ls gs vkskvks \VZ. Xbksk gvk xbk a`dy xua sa{vcks ao hkjg`h oav B i` xbis jahkd. Xbk hkjg`h oav C \C hZ gs g caj~a`k`x ao J is gookcxkh dgvekdy fy xbk sgjk ogcxavs gs gookcx xbk hkjg`h oav J$ s{cb gs dkkd ao i`cajk g`h xbk vgxk ao i`xkvksx$ gja`e axbkv xbi`es. Xbk sgjk is xv{k ao xbk hkjg`h oav HH \HH hZ. Xbkvkoavk gs g oivsx g~~varijgxia`$ ix is vkgsa`gfdk xa gss{jk xbgx C h g`h HHh uidd fk biebdy cavvkdgxkh*xbgx C h uidd fk g ~va~avxia`gd o{`cxia` ao HH. Xbis X bis jgy fk kr~vksskh gs

     

"8)

c$ xbk`$ is xbk vgxia ao C h xa HH. I` sbavx$ ix is xbk hksivkh c{vvk`cy*hk~asix vgxia ao xbk ~{fdic. c ixskdo uidd kr~vkss xbk ~vkokvk`cks ao xbk ~{fdic gs fkxukk` c{vvk`cy g`h hkjg`h hk~asixs ao fg`ls. Xbkvkoavk c is g fkbgia{vgd vgxia. F{x ix is gss{jkh xa fk g ca`sxg`x i` xbis jahkd. Xbk vkskvks ao fg`ls gvk {s{gddy hiihkh {`hkv xua bkghs= "g) vkw{ivkh vkskvks \VVZ g`h "f) krckss vkskvks \KVZ. Vkw{ivkh vkskvks gvk vkskvks ubicb fg`ls gvk vkw{ivkh sxgx{xavidy xa badh uixb xbk VFI. Fg`ls bgk `a cbaick gfa{x xbkj. [`hkv xbk dgu$ xbk VFI kj~aukvkh xa sxi~{dgxk xbk sxgx{xavy vkskvk vgxia$ ubicb jgy fk gvikh fkxukk` 3 ~kv ck`x g`h 7; ~kv ck`x ao xbk xaxgd hkjg`h g`h xijk digfidixiks ao g fg`l. Kkvy scbkh{dkh fg`l is vkw{ivkh xa jgi`xgi` gdd ixs VV gs fgdg`cks uixb xbk VFI. Gdd vkskvks i` krckss ao VV gvk cgddkh KV. Fg`ls gvk ovkk xa badh xbkj gs ‒cgsb a` bg`h’ gdsa cgddkh \g{dx cgsbZ uixb xbkjskdks av gs fgdg`cks uixb xbk VFI. Fg`ls badh KV ad{`xgvidy. Xbky gvk bkdh xa jkkx xbkiv cdkgvi`e hvgi`s \i.k.$ `kx dass ao cgsb h{k xa cvass* cdkgvi`e ao cbkw{ks gja`e fg`lsZ gs ukdd gs c{vvk`cy hvgi`s \i.k.$ `kx uixbhvgugd ao c{vvk`cy fy xbkiv hk~asixavsZ. Xbksk hvgi`s gvk ~gvxdy kr~kcxkh g`h ~gvxdy {`kr~kcxkh$ eii`e visk xa ubgx jgy fk cgddkh fg`ls’ xvg`sgcxia`s g`h ~vkcg{xia`gvy hkjg`h oav cgsb vkskvks. Uk by~axbksi}k xbgx KV h uidd fk hkxkvji`kh dgvekdy f y xbk fg`l’s xaxgd digfidixiks.

Xb{s faxb VV g`h KV g`h sa V h fkcajk i`cvkgsi`e o{`cxia`s ao xbk xaxgd hkjg`h g`h xijk digfidixiks ao fg`ls. Xbk hkjg`h g`h xijk digfidixiks ao fg`ls gvk ~vkhaji`g`xdy \gfa{x 96+Z h{k xa xbk hkjg`h g`h xijk hk~asixs ovaj xbk ~{fdic. Xbkvkoavk gs g sij~dioicgxia`$ sgy xbgx V h is dgvekdy g ~va~avxia`gd o{`cxia` ao xbk xaxgd hk~asixs ao xbk fg`ls= ";)

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v$ xbk` is xbk vgxia ao V h xa xaxgd hk~asixs ao fg`ls. Oav sbavx$ ix is cgddkh vkskvk*hk~asix vgxia. Ix is gss{jkh xbgx fg`l hk~asixs gvk ao xua li`hs* hkjg`h hk~asixs \HHZ g`h xijk hk~asixs \XHZ. Xbk oavjkv gvk ca{`xkh gs ja`ky< xbk dgxxkv `ax. Xbk hiisia` fkxukk` HH g`h XH is hkcihkh fy xbk ~{fdic$ eik` xbk xkvjs g`h ca`hixia`s a` ubicb fg`ls gvk uiddi`e xa skdd xbk xua li`hs ao xbk hk~asixs xa xbk ~{fdic. I` axbkv uavhs$ ix is xbk ~{fdic uba hkcihks bau j{cb XH xa badh i` vkdgxia` xa HH. Gegi`$ gs g sij~dioicgxia`$ ix is by~axbksi}kh xbgx  XHh is g` i`cvkgsi`e ~va~avxia`gd o{`cxia` ao HH.

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"5)

x is xbk vgxia ao XH h xa HH. Ix is cgddkh gs xijk*hk~asix vgxia. Ovaj kw{gxia` "5) g`h ovaj "?) uk ekx 

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Ovaj kw{gxia` ";) / "2)

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Vkcgddi`e xbgx      $ ovaj kw{gxia` "8) / "9) uk bgk

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Xb{s Bh bgs fkk` kr~vksskh gs g o{`cxia` ao HH g`h xbvkk fkbgia{vgd vgxias c$ x g`h v. Xbk jgvlkx oav B uidd fk i` kw{idifvi{j ubk` B h:Bs av ovaj kw{gxia` "3) / "7>) ubk`

̋     "  )   Xbk gfak kw{gxia` cg` fk sadkh oav HH

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"77)

Xbk gfak kw{gxia` eiks xbk kw{idifvi{j gd{k ao HH i` xkvjs ao B g`h xbk xbvkk fkbgia{vgd vgxias c$ x g`h v.  "  ") )

is cgddkh xbk hkjg`h –hk~asix j{dxi~dikv. @krx$ ovaj kw{gxia` "7) / "8) g`h g` h gss{ji`e xbgx C:C h$ uk bgk

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"76)

Xbk gfak is xbk lky kw{gxia` ao xbk B xbkavy ao ja`ky s{~~dy. Ix jglks xbk s{~~dy ao ja`ky g o{`cxia` ao B g`h xbk xbvkk fkbgia{vgd vgxias$ c$ x g`h v. Xbk kr~vkssia`

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eiks xbk gd{k ao ubgx is l`au` gs xbk ja`ky

j{dxi~dikv$ . Xbk`$ xbk kw{gxia` "76) cg` fk uvixxk` gs

̋  Xbk B xbkavy ao ja`ky s{~~dy is ~a~{dgvdy cgddkh xbk ja`ky j{dxi~dikv xbkavy ao ja`ky s{~~dy. Xbk kw{gxia` sgys xbgx xbk hkxkvji`g`xs ao xbk ja`ky s{~~dy ao J cg` fk cdgssioikh {`hkv xua jgi` bkghs= "g) xbask xbgx gookcx B g`h "f) xbask xbgx gookcx  . Ovaj xbk xbkavy ix is cdkgv xbgx ubkvkgs cbg`eks i` B gvk dgvekdy ~adicy*ca`xvaddkh$ cbg`eks i`  gvk dgvekdy k`haek`a{s$ i.k. gvk s{cb gs hk~k`h jgi`dy a` xbk fkbgia{vgd cbaicks ao xbk ~{fdic g`h fg`ls. Xbis is g {sko{d hisxi`cxia`$ g`gdyxicgddy gs ukdd gs oav ja`kxgvy ~dg``i`e. Ix ij~diks xbgx$ oav ~adicy ~{v~asks$ xbk ja`kxgvy g{xbavixy uidd ha ukdd xa xglk xbk fkbgia{v ao   gs sajkxbi`e a{xsihk ixs ca`xvad g`h xa ca`ck`xvgxk ixs kooavxs a` ca`xvaddi`e B xa ca`xvad J. Xbk oaddaui`e oie{vk sbaus xbk hkxkvji`gxia` ao ja`ky s{~~dy {`hkv B xbkavy. I` xbk oie{vk B is jkgs{vkh kvxicgddy g`h HH gvk jkgs{vkh bavi}a`xgddy. Si`ck xbk s{~~dy ao B is gss{jkh xa fk eik` kraek`a{sdy fy xbk ̋ $ xbk  c{vk is hvgu` ~gvgddkd xa xbk bavi}a`xgd gris gx xbk bkiebx   ̋ $ sbaui`e xbgx   is ja`kxgvy g{xbavixy gx   ~kvokcxdy i`kdgsxic xa HH. Xbk xbvkk hkjg`h c{vks i` xbk jgvlkx oav  gvk {~ugvh sda~i`e sxvgiebx di`ks eai`e xbva{eb xbk aviei` i` gccavhg`ck uixb xbk by~axbksks ao kw{gxia`s "8)$ "9) / "7>). Xbk  c{vk vk~vksk`xs kw{gxia` "8)$ uixb ixs sda~k kw{gd xa c. \I` I`hig gx ~vksk`x xbk gd{k ao c is gfa{x a`k. Sa xbk  c{vk bgs fkk` hvgu` xa jglk g` g`edk ao gfa{x 8; > uixb xbk bavi}a`xgd gris.Z Xbk  c{vk vk~vksk`xs kw{gxia` "9). Ixs sda~k bgs xbk gd{k ao   "  ) Xbk  c{vk is sij~dy xbk kvxicgd s{jjgxia` ao xbk    c{vks. Xb{s$ ix vk~vksk`xs kw{gxia` "7>). Xbk i`xkvskcxia` ao xbk  c{vk uixb xbk  c{vk eiks xbk kw{idifvi{j ao xbk  jgvlkx. Xbgx is$ gx xbis ~ai`x xbk ~{fdic g`h fg`ls gvk o{ddy bg~~y xa badh gdd xbk gja{`x ao   xbk ja`kxgvy g{xbavixy cbaacks xa ~dgck i` xbk  jgvlkx. I` xbis six{gxia`$ xbk kw{idifvi{j gja{`x ao  $ is xbgx sbau` fy < xbk ~{fdic badhs  gja{`x ao  ̋     oav fg`ls xa badh. Oav gja{`x$ xbis is krgcxdy kw{gd xa c{vvk`cy g`h dkgks xbk fgdg`ck ao  $ xbgx is$  fg`ls’  . Ix uidd gdsa fk `axkh xbgx$ eik` xbk  o{`cxia`$  is krgcxdy xbk gja{`x ao c{vvk`cy xbk ~{fdic ua{dh dilk xa badh ubk`   .

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K {idifv {idifvi{j i{j ao ao xbk B Jgvlk Jgvlkx  x