Money, Banks and Finance in Economic Thought

Theory of Money in the Structure of Marx’s Economics

Ananyin Oleg, National Research University "Higher School of Economics", and Institute of Economics, RAS

Karl Marx qua an economist is associated primarily with the Ricardian School of political economy, and as such – with a sort of long-period theorising. Despite good reasons in favour of this view, it is nevertheless one-sided and therefore distorting the structure and logic of Marx’s economic ideas. Marx’s relation to Ricardo was, in fact, far from straightforward, so that, in particular, borrowings from Ricardian value theory were accompanied by a rejection of his monetary doctrines. Marx’s monetary thought relied rather upon the alternative tradition in monetary theory coming back to Sir James Steuart and represented in his days by more pragmatic and short-run oriented authors, as were Thomas Tooke and the other members of the Banking School (see: Arnon, 2011; Smith, 2011). How to reconcile these facts with the well-founded claim that Marx’s theory of money is an integral part of his theory of value? (see: Rubin, 2017; De Brunhoff, 1976). The paper seeks to rethink Marx’s monetary thought as an attempt to combine the elements of both the orthodox long-run and the alternative short-run branches of classical monetary thought in a comprehensive theoretical system. Its focus is on the elements of short-run economic reasoning in Marx’s legacy with special regard to his theories of money and interest. Within classical orthodoxy these elements remained beyond its theoretical core as applied extensions dealing with temporary phenomena unworthy of scientific consideration. In the paper it is suggested that Marx’s principle of connecting heterogeneous theories has important methodological implications and sheds additional light on the overall structure of his economic system. References Arnon, A. 2011. Monetary Theory and Policy from Hume and Smith to Wicksell: Money Credit and the Economy. Cambridge University Press. De Brunhoff, S. 1976. Marx on money. NY: Urizen Books. Rubin, I.I. 2017. “Essays on Marx’s theory of money” (1926-28), In: Responces to Marx’s Capital. From Rudolf Hilferding to Isaak Illich Rubin. Ed. by R.B. Day and D.F. Gaido. Leiden: Brill. Smith, M. 2011. Thomas Tooke and the monetary thought of classical economics. L: Routledge.

Area:

Keywords: monetary theory; Marx, short run

Paper file