Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/110038
Authors: 
Wray, L. Randall
Year of Publication: 
2015
Series/Report no.: 
Working Paper, Levy Economics Institute 827
Abstract: 
In this paper, I examine whether Hyman P. Minsky adopted an endogenous money approach in his early work - at the time that he was first developing his financial instability approach. In an earlier piece (Wray 1992), I closely examined Minsky's published writings to support the argument that, from his earliest articles in 1957 to his 1986 book (as well as a handout he wrote in 1987 on "securitization"), he consistently held an endogenous money view. I'll refer briefly to that published work. However, I will devote most of the discussion here to unpublished early manuscripts in the Minsky archive (Minsky 1959, 1960, 1970). These manuscripts demonstrate that in his early career Minsky had already developed a deep understanding of the nature of banking. In some respects, these unpublished pieces are better than his published work from that period (or even later periods) because he had stripped away some institutional details to focus more directly on the fundamentals. It will be clear from what follows that Minsky's approach deviated substantially from the postwar "Keynesian" and "monetarist" viewpoints that started from a "deposit multiplier." The 1970 paper, in particular, delineates how Minsky's approach differs from the "Keynesian" view as presented in mainstream textbooks. Further, Minsky's understanding of banking in those years appears to be much deeper than that displayed three or four decades later by much of the post-Keynesian endogenous-money literature.
Subjects: 
Banks
Deposit Multiplier
Endogenous Money
Financial Innovation
Financial Instability Hypothesis
Horizontalists
Minsky
Originate to Distribute
Prudent Banking
Say's Law
Securitization
Income Distribution
Inequality
Gini Index
JEL: 
B3
B50
B52
E2
E4
E5
Document Type: 
Working Paper

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