Duncan K. Foley (foleyd@cepa.newschool.edu)
Fri, 17 Dec 1999 17:46:56 -0500
It seems to me that this point of view leads more to the idea that the
exchange value of state credit money depends on the solvency of the state
than on the scarcity of coin or money. On the state balance sheet you have
the present value of tax liabilities as one of the assets, and high-powered
money and other government debt as liabilities.
>On Sun, 12 Dec 1999, Duncan K. Foley wrote:
>
>> It's a bit more complicated than that, since the same volume
>> of coins can pay a larger tax bill at a higher velocity of
>> (tax) circulation.
>
>Interesting. How would one compute the velocity of tax
>circulation?
>
>> Isn't the idea that the state regulates the exchange value
>> of coin by controlling its scarcity basically the quantity
>> of money theory of prices?
>
>It's related, but what is missing from the standard Quantity
>Theory, as I see it, is that the relevant scarcity is scarcity
>relative to the tax liability imposed by the state.
>
>Allin.
Duncan K. Foley
Department of Economics
Graduate Faculty
New School University
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