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Economic Theory of Bank Credit - Oxford Scholarship Online
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Economic Theory of Bank Credit

L. Albert Hahn


This book sets out a credit theory of money and the effects of changes in credit activity on distribution and production. Part One shows that money is credit in circulation. Banks create money every time they grant genuinely new credit (i.e. not simply extending existing credit lines). The process of granting credit and creating money is illustrated by different technical processes in banking. Credit can only circulate when the debtor is known to be trustworthy. Accordingly capital and money markets are markets of trust and banks are the intermediaries of trust in the economy. In this interpre ... More

Keywords: monetary theory, theory of credit, banking theory

Bibliographic Information

Print publication date: 2015 Print ISBN-13: 9780198723073
Published to Oxford Scholarship Online: November 2015 DOI:10.1093/acprof:oso/9780198723073.001.0001


Affiliations are at time of print publication.

L. Albert Hahn, author
(1889 - 1968) was a German banker, economist, and university professor at the University of Frankfurt am Main