The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Money, Classical Theory of

  • Roy Green
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_650

Abstract

An integral part of the classical theory of value and distribution, the classical theory of money emerged largely in response to the issue of the relationship between changes in the money supply and the price level. This issue was central to the Price Revolution of the 16th and 17th centuries, the Napoleonic war inflation and the industrial crises of the mid-19th century. It was not the existence of an empirical correlation that was in dispute, but the direction of causation. A solution would therefore require a theoretical approach as well as knowledge of the facts.

Keywords

Bank Charter Act 1844 (UK) Bank Restriction period Banking School Bullion Report (1810) (UK) Bullionist controversies Cantillon, R. Classical dichotomy Classical law of circulation Classical theories of distribution Classical theory of money Convertibility Credit Currency School Equation of exchange Fiduciary money Hume, D. Inflation Law of reflux Law, J. Metallic money Monetarism Money, classical theory of Money supply Paper money Price Revolution Quantity theory of money Real bills doctrine Say’s Law Specie-flow mechanism Steuart, J. Tooke, T. Torrens, R. Value theory 

JEL Classifications

E4 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Roy Green
    • 1
  1. 1.