Hicks on monetary theory and history: money as endogenous money

Abstract

Hicks was never tired of saying that monetary theory is in history. What he meant was that monetary theory is intrinsically related to real events, and more importantly that monetary issues need to be analysed in a dynamic sequential context in which time plays an essential part. He went on developing a particular sequential analysis: the study of what happens within a single period (‘single-period theory’) and the study of the linkages between a succession of those periods (‘continuation theory’). It is suggested that this distinction provides a useful lesson for modern endogenous money theorists.