Understanding bank money through a quantum macroeconomic theory of credit. Some theoretical considerations on microcredit

Desogus, Marco (2020): Understanding bank money through a quantum macroeconomic theory of credit. Some theoretical considerations on microcredit. Published in: Journal of International Finance and Economics , Vol. 20, No. 3 (2020): pp. 5-18.

Abstract

Reframing risk assessments of microcredit, this paper expands on quantum macroeconomic conceptions of money, output and income to argue that production is endogenously financed. Building on the works of Schmitt, Cencini and Rossi, the conceptual logic of quantum monetary theory traces the origins of a (micro)firm’s finances to its consequent production. Production is then a self-sustaining system, and (micro)firms should not, in fact, dependent on worthiness decision made by banks for credit and funding. With especial focus on microfinance (and microcredit specifically), the socio-economic system requires restructuring to accommodate understandings of production as endogenous and microcredit as sustainable. This includes reforming national accounting practices to accurately represent possibilities of insolvency, themselves much reduced by the recognition of production as endogenous.

• Item Type: MPRA Paper
• Language: English
• Keywords: quantum-economics; theory of money emissions; economic system; financial intermediation; microcredit
• Subjects: E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E12 - Keynes ; Keynesian ; Post-Keynesian; E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E51 - Money Supply ; Credit ; Money Multipliers; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O11 - Macroeconomic Analyses of Economic Development; P - Economic Systems > P4 - Other Economic Systems > P44 - National Income, Product, and Expenditure ; Money ; Inflation

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