Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/277548 
Year of Publication: 
2022
Citation: 
[Journal:] European Journal of Economics and Economic Policies: Intervention (EJEEP) [ISSN:] 2052-7772 [Volume:] 19 [Issue:] 2 [Year:] 2022 [Pages:] 238-259
Publisher: 
Edward Elgar Publishing, Cheltenham
Abstract: 
Money in capitalism is a social force which exists not only on the level of wealth owners, but is also a force which stimulates economic development (or fails to do so). According to Hajo Riese the asset-protecting function of money, which can be expressed in a liquidity premium, indicates different qualities of money. At the top of the hierarchy are a small number of currencies which take over national and international functions; at the bottom are currencies which only partly take over national functions. Countries issuing these currencies suffer from dollarisation and capital flight. The consequence is that they cannot have a strong and sustainable Schumpeterian credit–investment mechanism. External credit seems to be a solution, but external debt together with credit dollarisation leads to a fragile domestic financial system and the likelihood of overindebtedness. A poor quality of money is one key element in explaining the reproduction of underdevelopment.
Subjects: 
currency hierarchy
dollarisation
underdevelopmentE42
F63
O16
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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