2 ms·
I think what they're trying to say is that although in economic theory central banks are thought to control the quantity of money, in reality they control the p
by lottin 4y ago
I think what they're trying to say is that although in economic theory central banks are thought to control the quantity of money, in reality they control the price of money. (They can't control both the quantity and the price.) My understanding is that whether they set the price or the quantity of money via monetary policy is a sort of implementation detail that shouldn't make any difference, although I'm by no means an expert.