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Do We Need a Distinct Monetary Constitution?

Steven Horwitz

St. Lawrence University

August 10, 2010

The Chicago-Virginia tradition of political economy has rejected both competitive money production and money’s politicization via post-constitutional bargaining, opting instead for constitutionalization. This paper provides a constitutional political economy of the costs of inflation and argues that competitive money production is not subject to the pro-cyclicality that concerns constitutional political economy. It also meets the standard of predictability that motivates constitutional perspectives, although at the level of individual prices rather than the price level. An effective monetary constitution is implicit in any constitution that protects rights to property, contract, and exchange and sets limits on the democratic process.

Number of Pages in PDF File: 28

Keywords: Constitutional Political Economy, Monetary Regimes, Free Banking, Inflation

JEL Classification: E58, N2

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Date posted: August 24, 2010  

Suggested Citation

Horwitz, Steven, Do We Need a Distinct Monetary Constitution? (August 10, 2010). Available at SSRN: https://ssrn.com/abstract=1663889 or http://dx.doi.org/10.2139/ssrn.1663889

Contact Information

Steven Horwitz (Contact Author)
St. Lawrence University ( email )
One Romoda Drive
Canton, NY 13617
United States
315 229 5731 (Phone)
315 229 5819 (Fax)
HOME PAGE: http://myslu.stlawu.edu/~shorwitz
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