Economics and Finance

The Necessity of Overissuing Money and Welfare Policy Based on a Simple Model

Authors: Chengshen Xu
Comments: 4 Pages.

Many economic theories advocate that currency issuance only needs to be proportional to social value. Even in Keynesian economics, excessive currency issuance is only regarded as a means to stimulate economic development during an economic downturn cycle. However, through our research, we have found that even in an economic environment without economic cycles and in steady development, excessive currency issuance is still indispensable. The reason is that every capitalist and individual is in pursuit of interests, so only keeping currency issuance proportional to social value will cause society to lose the source power of creating value. This article will use an extremely simple model to explain the necessity of excessive currency issuance and welfare policies. Although our model is extremely simple, it still has certain value and can assist countries in formulating reasonable monetary policies and even economic policies.
Category: Economics and Finance