This book shows that the use of money transforms a market economy into a payment society where production and employment are subordinated to the logic of asset markets. Monetary policy emerged out of private banking business and was always exposed to the risk of losing credibility and reputation. The stability of key currency systems was based on different policy preferences. A simple game-theoretic macro model explains the working and the downfall of the gold standard, Bretton Woods and the European Monetary System. It is shown that waning willingness to accept foreign leadership in monetary policy affairs propelled the creation of the euro.
On the Theory of a Monetary Economy: Market Organization and Monetary Contracts.- Money, Interest and Capital.- Bankingand the Rise of Monetary Policy: Banks as Creators of Money.- The Emergence of Central Banking in England.- TheEvolution of Key Currency Systems: A Game-TheoreticPerspective: The Hegemony of Pound Sterling in the Gold Standard.- The Loss of Credibility and Stability in the Bretton Woods System.- The European Paper Money Standard: A "DM Club".- The Euro in the World Economy: A Monetary Union with a Denationalized Currency.- The Multiple International Monetary Standard.