Theories of Money Creation: From Post-keynesians to Circuitists. Review and Prospects

Contrary to the neo-classical position, post-keynesians and circuitists developed the endogenous money approach, emphasising the function of banks in the creation of money and considering that the interest rate is exogenous (fixed by the Central Bank). Both, Post-keynesians and Circuitists, develop their arguments using some of Keynes' insights: the “finance motive”, his conception of credit, the principle of effective demand and the role of uncertainty. Because of this common background the frontier between these currents of thought is fuzzy and changing. Therefore, it is often difficult to appreciate the differences between themmoney, post-keynesian