Uniquely among monetary textbooks, this text teaches monetary economics using a simple model based on standard microeconomics. The model is clearly and explicitly specified so that students see and participate in discovering the implications of the model for monetary questions. Variations of this model are then used to address the important monetary topics-- inflation, currency crises, monetary unions, bank runs, the payments system, central banking, and the national debt, among many others.
Organized into three sections of increasing complexity. Part One examines money in isolation--demand for fiat money, a comparison of fiat and commodity monies, inflation and exchange rate. The second section adds capital to study money's interaction with other assets and banking. Lastly, it looks at money's effect on saving, investment and output through its effect on nonmonetary government debt.
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