The Troubling Suppression of Competition from Alternative Monies:
The Cases of the Liberty Dollar and E-Gold

30 Pages Posted: 12 May 2014  

Lawrence H. White

George Mason University - Department of Economics

Date Written: March 10, 2014

Abstract

An uncommon approach to US monetary reform, exemplified by F. A. Hayek’s 1976 monograph Choice in Currency, is to end legal barriers to alternative monies, whether as units of account or as media of exchange. Alternative monetary standards might then arise in the marketplace to operate in parallel with the fiat dollar, perhaps gradually to displace it. Here I look at two private alternative monetary systems that were available until disallowed by the federal government, the silver “Liberty Dollar” (a hand-to-hand currency) and e-gold (a system for online transfers among gold accounts). Their suppressions illustrate how legal restrictions are currently blocking monetary innovation. The same restrictions may be used against Bitcoin and other crypto-currencies.

Keywords: Liberty Dollar, Bitcoin, E-Gold, Alternative Monies

JEL Classification: E40, E44, E50

Suggested Citation

White, Lawrence H., The Troubling Suppression of Competition from Alternative Monies: The Cases of the Liberty Dollar and E-Gold (March 10, 2014). GMU Working Paper in Economics No. 14-06. Available at SSRN: https://ssrn.com/abstract=2406983 or http://dx.doi.org/10.2139/ssrn.2406983

Lawrence H. White (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

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