Monetary Theory and Policy from Hume and Smith to Wicksell
Money, Credit, and the Economy

“Arie Arnon’s book is a great achievement. Meticulously researched and lucid, it lays out the roots of modern monetary and banking theory in the controversies that convulsed England’s rise as an industrial and trading power. Confronting financial innovation, crises, and the need for macroeconomic balance – as we do today – ‘practical theorists’ from Henry Thornton onwards developed the understanding of credit-based money that provides foundations for today’s central banking and financial regulation. Monetary Theory and Policy from Hume and Smith to Wicksell is one of those rare books that redefines its field. It is indispensable reading for thoughtful bankers and economists alike.” – Laurence Harris, University of London

“Arie Arnon’s ambitious history of monetary theory and policy is History of Economic Thought at its very best. It provides an authoritative account of monetary doctrine from the eighteenth through nineteenth centuries, attending impressively to the strong interconnection between ideas and financial environment, and throughout taking under consideration a notoriously massive secondary literature. But it does more than that. The study impresses on the reader the high relevance for our own day of insights developed as much as two hundred years ago. Our policy makers, not only academic economists, would be well advised to take this book seriously.” – Samuel Hollander, University of Toronto

“Arnon follows a new path through this well-traveled country, paying rather more attention than earlier guides to theoretical signposts, and a little less to policy markers. He has written a subtly original and thoroughly absorbing book.” – David E. W. Laidler, University of Western Ontario

“An impressive survey of the major developments in monetary theory and associated positions on policy from the eighteenth to the nineteenth centuries. A fine, scholarly reconstruction and a very readable account of the logical structure of money and credit theories, particularly instructive and relevant in the current financial crisis.” – Maria Cristina Marcuzzo, Università di Roma “La Sapienza,” Italy

“Arie Arnon’s history of monetary theory and policy from Hume to Wicksell provides an excellent roadmap to understanding the nature and evolution of the British tradition. The book is well researched and clearly written. Every chapter is good; some, such as Chapter 11 on the Currency School, are simply outstanding. This is a book that monetary historians will want to acquire.” – Neil T. Skaggs, Illinois State University