Monetary economics after Wicksell: alternative perspectives within the theory of the monetary circuit

The chapter discusses Augusto Graziani’s heterodoxy in monetary thought. This author has stressed the divide between the individualistic, non-monetary, static and equilibrium paradigms, on the one hand, and the holistic, monetary, dynamic and disequilibrium paradigms, on the other. Among these latter, Graziani has chosen to privilege those authors who proposed an analysis of capitalism as a monetary production economy. The crucial notion of money here refers to its purchasing power, not merely as means of payment but primarily as ‘finance’. The banking system’s credit creation allows the firm’s sector to shape the real structure of the economy, and define income distribution. The main reference is therefore to Wicksell, Schumpeter and Keynes’s "Treatise on Money".