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Quantity theory of money

Index Quantity theory of money

In monetary economics, the quantity theory of money (QTM) states that the general price level of goods and services is directly proportional to the amount of money in circulation, or money supply. [1]

67 relations: A Contribution to the Critique of Political Economy, Alfred Marshall, American Civil War, Arthur Cecil Pigou, Benjamin Anderson, Capital (economics), Central bank, Ceteris paribus, Classical dichotomy, Cumulative process, David Hume, David Laidler, Demand for money, Economic indicator, Economic model, Empirical evidence, Equation of exchange, Exogeny, Federal Reserve System, Financial intermediary, Fiscal theory of the price level, Income, Inflation, Interest rate, Irving Fisher, Jean Bodin, John Maynard Keynes, John Stuart Mill, Karl Marx, Keynesian economics, Knut Wicksell, Labor theory of value, Liquidity preference, Long run and short run, Ludwig von Mises, Martín de Azpilcueta, Milton Friedman, Modern Monetary Theory, Monetae cudendae ratio, Monetarism, Monetary economics, Monetary inflation, Monetary policy, Money supply, National Income and Product Accounts, Neutrality of money, New classical macroeconomics, New World, Nicolaus Copernicus, Nominal rigidity, ..., Paper Credit, Price level, Productivity, Real bills doctrine, Real interest rate, Real versus nominal value (economics), Robert Lucas Jr., School of Salamanca, Simon Newcomb, The General Theory of Employment, Interest and Money, The New Palgrave Dictionary of Economics, The Theory of Money and Credit, Thomas M. Humphrey, Time preference, Transpose, University of Cambridge, Velocity of money. Expand index (17 more) »

A Contribution to the Critique of Political Economy

A Contribution to the Critique of Political Economy (Zur Kritik der Politischen Ökonomie) is a book by Karl Marx, first published in 1859.

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Alfred Marshall

Alfred Marshall, FBA (26 July 1842 – 13 July 1924) was one of the most influential economists of his time.

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American Civil War

The American Civil War (also known by other names) was a war fought in the United States from 1861 to 1865.

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Arthur Cecil Pigou

Arthur Cecil Pigou (18 November 1877 – 7 March 1959) was an English economist.

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Benjamin Anderson

Benjamin McAlester Anderson Jr. (May 1, 1886 – January 19, 1949) was an American economist of the Austrian School.

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Capital (economics)

In economics, capital consists of an asset that can enhance one's power to perform economically useful work.

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Central bank

A central bank, reserve bank, or monetary authority is an institution that manages a state's currency, money supply, and interest rates.

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Ceteris paribus

Ceteris paribus or caeteris paribus is a Latin phrase meaning "other things equal".

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Classical dichotomy

In macroeconomics, the classical dichotomy is the idea, attributed to classical and pre-Keynesian economics, that real and nominal variables can be analyzed separately.

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Cumulative process

Cumulative process is a contribution to the economic theory of interest, proposed in Knut Wicksell's 1898 work, Interest and Prices. Wicksell made a key distinction between the natural rate of interest and the money rate of interest.

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David Hume

David Hume (born David Home; 7 May 1711 NS (26 April 1711 OS) – 25 August 1776) was a Scottish philosopher, historian, economist, and essayist, who is best known today for his highly influential system of philosophical empiricism, skepticism, and naturalism.

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David Laidler

David Ernest William Laidler (born 12 August 1938, England) is an economist who has been one of the foremost scholars of monetarism.

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Demand for money

In monetary economics, the demand for money is the desired holding of financial assets in the form of money: that is, cash or bank deposits rather than investments.

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Economic indicator

An economic indicator is a statistic about an economic activity.

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Economic model

In economics, a model is a theoretical construct representing economic processes by a set of variables and a set of logical and/or quantitative relationships between them.

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Empirical evidence

Empirical evidence, also known as sensory experience, is the information received by means of the senses, particularly by observation and documentation of patterns and behavior through experimentation.

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Equation of exchange

In monetary economics, the equation of exchange is the relation: where, for a given period, Thus PQ is the level of nominal expenditures.

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Exogeny

In a variety of contexts, exogeny or exogeneity is the fact of an action or object originating externally.

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Federal Reserve System

The Federal Reserve System (also known as the Federal Reserve or simply the Fed) is the central banking system of the United States of America.

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Financial intermediary

A financial intermediary is an institution or individual that serves as a middleman among diverse parties in order to facilitate financial transactions.

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Fiscal theory of the price level

The fiscal theory of the price level is the idea that government fiscal policy affects the price level: for the price level to be stable (to control inflation), government finances must be sustainable: they must run a balanced budget over the course of the business cycle, meaning they must not run a structural deficit.

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Income

Income is the consumption and savings opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms.

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Inflation

In economics, inflation is a sustained increase in price level of goods and services in an economy over a period of time.

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Interest rate

An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited or borrowed (called the principal sum).

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Irving Fisher

Irving Fisher (February 27, 1867 – April 29, 1947) was an American economist, statistician, inventor, and Progressive social campaigner.

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Jean Bodin

Jean Bodin (1530–1596) was a French jurist and political philosopher, member of the Parlement of Paris and professor of law in Toulouse.

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John Maynard Keynes

John Maynard Keynes, 1st Baron Keynes (5 June 1883 – 21 April 1946), was a British economist whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments.

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John Stuart Mill

John Stuart Mill, also known as J.S. Mill, (20 May 1806 – 8 May 1873) was a British philosopher, political economist, and civil servant.

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Karl Marx

Karl MarxThe name "Karl Heinrich Marx", used in various lexicons, is based on an error.

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Keynesian economics

Keynesian economics (sometimes called Keynesianism) are the various macroeconomic theories about how in the short run – and especially during recessions – economic output is strongly influenced by aggregate demand (total demand in the economy).

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Knut Wicksell

Johan Gustaf Knut Wicksell (December 20, 1851 – May 3, 1926) was a leading Swedish economist of the Stockholm school.

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Labor theory of value

The labor theory of value (LTV) is a theory of value that argues that the economic value of a good or service is determined by the total amount of "socially necessary labor" required to produce it, rather than by the use or pleasure its owner gets from it (demand) and its scarcity value (supply).

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Liquidity preference

In macroeconomic theory, liquidity preference is the demand for money, considered as liquidity.

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Long run and short run

In microeconomics, the long run is the conceptual time period in which there are no fixed factors of production, so that there are no constraints preventing changing the output level by changing the capital stock or by entering or leaving an industry.

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Ludwig von Mises

Ludwig Heinrich Edler von Mises (29 September 1881 – 10 October 1973) was an Austrian-American theoretical Austrian School economist.

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Martín de Azpilcueta

Martín de Azpilcueta (Azpilikueta in Basque) (13 December 1491 – 1 June 1586), or Doctor Navarrus, was an important Spanish canonist and theologian in his time, and an early economist, the first to develop monetarist theory.

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Milton Friedman

Milton Friedman (July 31, 1912 – November 16, 2006) was an American economist who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory, and the complexity of stabilization policy.

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Modern Monetary Theory

Modern Monetary Theory (MMT or Modern Money Theory) is a macroeconomic theory that describes and analyses modern economies in which the national currency is fiat money, established and created by a sovereign government.

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Monetae cudendae ratio

Monetae cudendae ratio (also spelled Monetæ cudendæ ratio; English: On the Minting of Coin or On the Striking of Coin; sometimes, Treatise on Money) is a paper on coinage by Nicolaus Copernicus (Polish: Mikołaj Kopernik).

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Monetarism

Monetarism is a school of thought in monetary economics that emphasizes the role of governments in controlling the amount of money in circulation.

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Monetary economics

Monetary economics is a branch of economics that provides a framework for analyzing money in its functions as a medium of exchange, store of value, and unit of account.

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Monetary inflation

Monetary inflation is a sustained increase in the money supply of a country (or currency area).

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Monetary policy

Monetary policy is the process by which the monetary authority of a country, typically the central bank or currency board, controls either the cost of very short-term borrowing or the monetary base, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency.

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Money supply

In economics, the money supply (or money stock) is the total value of monetary assets available in an economy at a specific time.

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National Income and Product Accounts

The national income and product accounts (NIPA) are part of the national accounts of the United States.

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Neutrality of money

Neutrality of money is the idea that a change in the stock of money affects only nominal variables in the economy such as prices, wages, and exchange rates, with no effect on real variables, like employment, real GDP, and real consumption.

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New classical macroeconomics

New classical macroeconomics, sometimes simply called new classical economics, is a school of thought in macroeconomics that builds its analysis entirely on a neoclassical framework.

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New World

The New World is one of the names used for the majority of Earth's Western Hemisphere, specifically the Americas (including nearby islands such as those of the Caribbean and Bermuda).

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Nicolaus Copernicus

Nicolaus Copernicus (Mikołaj Kopernik; Nikolaus Kopernikus; Niklas Koppernigk; 19 February 1473 – 24 May 1543) was a Renaissance-era mathematician and astronomer who formulated a model of the universe that placed the Sun rather than the Earth at the center of the universe, likely independently of Aristarchus of Samos, who had formulated such a model some eighteen centuries earlier.

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Nominal rigidity

Nominal rigidity, also known as price-stickiness or wage-stickiness, describes a situation in which the nominal price is resistant to change.

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Paper Credit

An Enquiry into the Nature and Effects of the Paper Credit of Great Britain, generally shortened to Paper Credit, is a book on monetary theory in economics, written by Henry Thornton and published in Britain in 1802.

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Price level

The general price level is a hypothetical daily measure of overall prices for some set of goods and services (the consumer basket), in an economy or monetary union during a given interval (generally one day), normalized relative to some base set.

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Productivity

Productivity describes various measures of the efficiency of production.

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Real bills doctrine

The real bills doctrine asserts that money should be issued in exchange for short-term real bills of adequate value.

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Real interest rate

The real interest rate is the rate of interest an investor, saver or lender receives (or expects to receive) after allowing for inflation.

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Real versus nominal value (economics)

In economics, a real value of a good or other entity has been adjusted for inflation, enabling comparison of quantities as if prices had not changed.

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Robert Lucas Jr.

Robert Emerson Lucas Jr. (born September 15, 1937) is an American economist at the University of Chicago.

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School of Salamanca

The School of Salamanca (Escuela de Salamanca) is the Renaissance of thought in diverse intellectual areas by Spanish and Portuguese theologians, rooted in the intellectual and pedagogical work of Francisco de Vitoria.

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Simon Newcomb

Simon Newcomb (March 12, 1835 – July 11, 1909) was a Canadian–American astronomer, applied mathematician and autodidactic polymath, who was Professor of Mathematics in the U.S. Navy and at Johns Hopkins.

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The General Theory of Employment, Interest and Money

The General Theory of Employment, Interest and Money of 1936 is the last and most important book by the English economist John Maynard Keynes.

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The New Palgrave Dictionary of Economics

The New Palgrave Dictionary of Economics (2008), 2nd ed., is an eight-volume reference work on economics, edited by Steven N. Durlauf and Lawrence E. Blume and published by Palgrave Macmillan.

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The Theory of Money and Credit

The Theory of Money and Credit is a 1912 economics book written by Ludwig von Mises, originally published in German as Theorie des Geldes und der Umlaufsmittel.

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Thomas M. Humphrey

Thomas MacGillivray Humphrey (born 1935) is an American economist.

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Time preference

In economics, time preference (or time discounting, delay discounting, temporal discounting) is the current relative valuation placed on receiving a good at an earlier date compared with receiving it at a later date.

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Transpose

In linear algebra, the transpose of a matrix is an operator which flips a matrix over its diagonal, that is it switches the row and column indices of the matrix by producing another matrix denoted as AT (also written A′, Atr, tA or At).

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University of Cambridge

The University of Cambridge (informally Cambridge University)The corporate title of the university is The Chancellor, Masters, and Scholars of the University of Cambridge.

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Velocity of money

Similar chart showing the velocity of a broader measure of money that covers M2 plus large institutional deposits, M3. The US no longer publishes official M3 measures, so the chart only runs through 2005. The term "velocity of money" (also "The velocity of circulation of money") refers to how fast money passes from one holder to the next.

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Quantity Theory Of Money, Quantity Theory of Money, Quantity equation, Quantity theory.

References

[1] https://en.wikipedia.org/wiki/Quantity_theory_of_money

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