Research On The Monetary Theory Of The Modern Austrian School

In Robinson's island life,"money" is an unnecessary concept.Whether there was only Robinson himself or there were Robinson and Friday in later,money,a symbol of indirect exchange,needn't exist in this island.For them,the simple barter is more convenient,direct and practical than the money medium,and it does not need to waste the extra manpower and material resources to produce the money commodity.However,in the real economy,there isn't lonely Robinson.Everyone lives in a large family of human collective society,looking directly at the crowd which is more than two persons.Here,everyone has different resource products,and has this or that demand.Self sufficiency is much trouble than mutual exchange,direct exchange has a less obvious benefit than indirect exchange.Therefore,the history of the direct exchange is very short,the indirect exchange stage came quickly,the most marketable "money" products came into being.After the generation of money,the topic about the relationship of money and the real economy appeared.Before twentieth Century,the monetary theory of classical economists catched most economists' sight.With the attitude of "dichotomy",they directly separated money and the real economy,which are two disjoint parallel lines.Actually,the real economy is veiled by neutral money.The development of economy is ultimately decided by the factors of real economy,rather than monetary factors.After twentieth Century,the monetary theory of classical economics was seriously challenged.Searl,Keynes,and a large number of economists stood on the opposite side.They criticized the classical economists' view of monetary neutrality,and emphasized the integration of money and economy.It greatly promoted the improvement of the monetary theory system.After the quantity theory of money,the economic fluctuation theory of money also be included in the monetary theory system.Behind the redefinition of the relationship between money and the real economy,different economists have the same purpose,paving the way for their monetary policy.Based on the great influence of money on the real economy,Keynes found a good excuse for the government to intervene in the operation of monetary policy.Freedman attributed economic instability to the reckless of government's monetary policy acts,advocated the implementation of monetary policy follow some rules.Differently,The Austrian scholars,who act as very conscientious liberal apologists,strongly aganist the government intervention in the market economy,insist on the elimination of monetary policy.However,the Austrian school's policy ideas is less popular than Keynes' s propositions.On the one hand,the difference can find reasons from the government interest groups.On the other hand,the Austrian School‘s special methodology is also related to it.The individualism and subjectivism methodology couldn't be accepted by other economists.They classify it as philosophy,rather than economics.As a result,the study of the Austrian school's monetary theory is slow.But other economists' attitudes failure to force the Austria school giving up.They still stick to their own unique methodological foundation,and to guide the development of their monetary theory.So far,the monetary theory of the Austrian school has developed to the third generation.From Menger to Mises and Hayek,the representative of the second generation,and then to the modern Austrian school which is led by Rothbard,the monetary theory is getting better and better.With the spirit of inheritance and criticism,the modern Austrian school push it's monetary theory to a new level.On the inside,the basic theory support the academic research frame of the whole school.On the outside,it's a gun which directs at both the governmentism and the monetarist.With a combination of government intervention and numbers of failure facts,the modern Austrian school refresh people's awareness of the dangers of government intervention.As the financial crisis sweeping global economy,the dawnturn last for a long time.Up to now,the world economy has not yet been fully recover.After the c risis,many monetary policies had been carried out by goverment.The effection w asn't obvious,currency devaluation was more serious than ever.In the meantime,the modern Austrian School seized the opportunity,attacking other economic schoo ls,Proposing their opinion on the money,hoping to cut off the link between the government and the currency.Although the results can be imagined,this behavior did obtain the attention of some economists.The trend of unpopularity has been r eversed.People began to learn the modern Austrian school and try to find someti ng from it to solve the global economic crisis.In order to satisfy people's desire for the modern Austrian school,this paper aims to give a more comprehensive interpretation of the modern Austria school monetary theory,emphasize on its new development and new content,provide new ideas and new methods for the development of economy.In order to better analyze the monetary theory of the modern Austrian school,this paper focus on the former and the modern Austrian scholars' monetary theory,their proposals.First,this paper introduces the method of the Austrian school.The former's monetary theory includes the Austrian school founder's opinion on the origin of the money.Also,there are the regression theorem of Mises and Hayek,who is the representative figure of the two generation of the Austrian School,the value of money which based on money supply and demand model,and the neutral money theory.Secondly,in the introduction of monetary theory,this paper starts from the definition of the scope of money supply,the quantity of money,the theory of monetary quality,and to the relationship between money ?economic cycle,inflation and economic recession.In the end,the modern Austrian school puts its monetary theory into practice,and puts forward the idea of coin's privatization and the restoration of classical gold standard system.The operability of these propositions are increased.