출처: J. M. Keynes, A Treatise on Money (October 31, 1930)
※ 발췌 / excerpts of which: Book Ⅳ, The Dynamics of the Price-Level,
* * *
Chapter 17. Changes due to Monetary Factors (p. 262)
It does not make much difference to the subsequent course of the argument whether the balance between the demand and supply of money for the Industrial Circulation is changed as a result of a change in the total supply of money or of a change in the requirement of the Financial Circulation, or of a change in the requirements of the Industrial Circulation relatively to the value of output, or of a change in the volume of Incomes. For example, if the requirements of the Industrial Circulation are falling relatively to the value of output, this means that entrepreneurs are getting back against current sales more money that they require to maintain output at the existing bill of costs, so that the Banking System finds itself withe redundant lending power at the old equilibrium, just as it would if the total supply of money had been augmented. It will be sufficient, therefore, to consider the case of a change in the total supply of money.
(1) Industrial Consequences of a Changed Supply of Money (p. 262)
By what route will the injection of an increased quantity of money into the monetary system, or a withdrawal of money from it, bring about a new equilibrium at a changed price-level?
Since the injection of an increased quantity of cash (using this word to include Central Bank reserves) into the monetary system will increase the reserve-resources of the member banks, it will, for reasons already explained, render the latter more willing lenders on easier terms; that is to say, the new money stimulates the banks to put resources at the disposal of those borrowers who are ready to employ them, if they are offered on satisfactory terms. Conversely, a withdrawal of cash from the monetary system, by reducing the reserve-resources of the member banks, influences the latter to withdraw resources from borrowers.
Now it may be that part of the proceeds of the new loans will find their way indirectly to the Savings-deposits or to the Business-deposits B, thus augmenting the Financial Circulation. But the rest must, directly or eventually, find its way into the hands of the entrepreneurs. This being so, it is, in general, probable that the greater ease of borrowing willㅡwhatever other effects it may also haveㅡinfluence entrepreneurs in one or other of three ways :
But the consequence of a change in prices due to the inequality of I and S is, as we have seen in Chapter 11, to give a windfall profit to entrepreneurs. Under the stimulus of this profit the secondary phase of the transition is introduced. For the stimulus of profit influences entrepreneurs to bid more eagerly for the services of the factors of production, and so causes the rate of efficiency-earnings M1.V1/O to increase, whether or not this has already occurred to a certain extent in the primary phase.
So far we have assumed that the supply of money has been increased and that the terms of lending are easier. But the same argument applies ^mutatis mutandis^ where it is a case of a diminished supply of money and stiffer terms of lending.
(2) The Diffusion of a Change in the Total Deposits between the Different Kinds of Deposits (p. 265)
- (ⅰ) The lower rate of interest will stimulate the production of capital-goods by raising their prices. Moreover this tendency may be further encouraged if at the same time the effect of ampler and cheaper money for the Financial Circulation is having the effect of raising security-prices.
- (ⅱ) In so far as there was previously an unsatisfied fringe of would-be entrepreneur borrowers (which, as we shall see subsequently, is sometimes the case) who were ready to borrow, if they had been able, even at the old terms, and also, on the other hand, an unemployed fringe of the factors of production, certain entrepreneurs will now be enabled to offer employment to an additional quantity of the factors of production at the existing rates of remuneration. [1]
[1] Since the rate of remuneration to the factor Capital is less than before, owing to the fall in the rate of interest, the above is compatible with an ^increase^ (but probably only a small one) to the other factors of production.
- (ⅲ) Certain entrepreneurs may now be willing to increase their output even if this means making higher offers than before to the factors of production because (as the ultimate result of the influx of new money) they foresee profits.
[1] In this and the succeeding chapter I shall sometimes ignore the distinction between the purchasing power of money and the price-level of output as a whole, and the extra complication due to the fact that I and I' are not necessarily equal. But where the essence of the argument is affected, I shall, of course, draw attention to this.In the most straightforward case where there is in the first instance no change in the rates of efficiency-earnings, i.e. where entrepreneurs do not improve their offers to the factors of production, the whole of the ^initial^ rise in prices is due to the second term, i.e. to the stimulus to investment caused by the easier conditions of borrowing. It may be even that in the first instance there will be no change either in the rates of efficiency-earnings or in the volume of employment, so that M1.V1 is unaltered, the initial effect of the new money on prices operating wholly through the stimulus to investment. In this case it is probable that comparatively little new money will be needed to augment the Industrial Circulation, and any surplus beyond this will have to be temporarily absorbed by a decrease of Velocities or an increase in the Financial Circulation.
But the consequence of a change in prices due to the inequality of I and S is, as we have seen in Chapter 11, to give a windfall profit to entrepreneurs. Under the stimulus of this profit the secondary phase of the transition is introduced. For the stimulus of profit influences entrepreneurs to bid more eagerly for the services of the factors of production, and so causes the rate of efficiency-earnings M1.V1/O to increase, whether or not this has already occurred to a certain extent in the primary phase.
So far we have assumed that the supply of money has been increased and that the terms of lending are easier. But the same argument applies ^mutatis mutandis^ where it is a case of a diminished supply of money and stiffer terms of lending.
(2) The Diffusion of a Change in the Total Deposits between the Different Kinds of Deposits (p. 265)
We may nowㅡat the expense of some recapitulationㅡconsider in more detail by what routes an increase in the total deposits distributes itself between the Savings-deposits, the Business-deposits and the Income-deposits.
Obviously, the first effect of a new loan by a bank is to increase the deposits of the borrower by the amount of loan. Now it is uncommon for a borrower to borrow, not for any business or investment purpose, but to meet his personal expenditure on consumption;ㅡat any rate, bank loans of this kind are so small a proportion of the whole that we can in general neglect them. Further, it would be unusual to borrow merely in order to add the money to the Savings-deposits, since the interest payable by borrowers always exceeds the interest allowed to depositors; so that this contingency also we can neglect. Generally speaking, therefore, the proceeds of a new loan are added in the first instance to the Business-deposits.
Some part of this addition to the Business-deposits will probably find its way, more or less directly, into the hands of entrepreneurs, who are encouraged by the easier terms of borrowing, to be used by them to meet an increased earnings-bill M1.V1. This increased earnings-billㅡas we have seen aboveㅡmay or may not be associated with an increase in M1.V1/O, the rate of efficiency-earnings. Thus a part of the new money will quickly find its way from M2 into M1, the Income-deposits, and a corresponding part will remain in the Business-deposits A to look after the increased turnover of the entrepreneurs corresponding to their increased earnings-bill. Some small increase in Business-deposits A may also be required as a result of the emergence of profits.
The rest of the addition to the Business-depositsㅡwhich may conceivably amount in the first instance to the whole of the additional moneyㅡwill fall into the hands of speculators and financiers, i.e. of persons who wish to buy commodities or securities with borrowed money. This will raise the price of securities, and the boom in securities thus brought about will probably increase the Stock Exchange turnover. Thus a part, but usually a very small part, of the new money will have to be retained in the Business-deposits B to look after the increased money-turnover of securities. Now for every buyer of a security (or commodity) there must be a seller. The seller may use the proceeds to buy some other security, in which case the rise in price of securities will spread from one category to another. But as the price of securities continues to rise, one or other of two thing must, sooner or later, happen. It may be that this price-rise will furnish windfall profits to the producers of ^new^ investments, with the result that, ^via^ the new issue market or otherwise, increased funds will reach the hands of entrepreneurs for the purpose of increasing, or endeavouring to increase, the output of investment. The further course of events will then be the same as in the case already considered.
The other alternative is that the rising prices of securities will cause a difference of opinion to develop between two sections of the financial community,ㅡone section (the "bulls") believing in the continuance of the price-rise and willing to buy with borrowed money, the other section (the "bears") doubting the continuance and preferring to sell securities for cash or bills or other liquid assets. Or, in so far as the banks are themselves buying securities, it will be sufficient if a "bear" position develops. Now in so far as the bears' funds are lend to the bulls otherwise than through the Banking System, the Stock Exchange boom can continue with the aid not only of the new money but also of the proceeds of the bears' sales. But in so far as the bears add the proceeds of their sales (or of their refraining from buying securities with their current savings) to the Savings-deposits, this uses up part of the new money in appropriately increasing M3.
Thus all the new money will eventually find its way either to M1, corresponding to (1) the increased earnings-bill M1.V1, or to M2 to look after either (2) the increased entrepreneurs' turnover or (3) the increased Stock Exchange turnover, or to M3 to provide for (4) the enlargement of the "bear" position.
Now so long as the new money is absorbed by (3) and (4), without, however, stimulating the output of new investment, there will be no effect on the purchasing power of money, since, although I (the value of the output of new investment) will have increased, I' (the cost of this output) will not have increased. But in so far as the earnings-bill M1.V1 is increased, and also in so far as entrepreneurs change over from the production of consumption-goods to that of capital-goods under the influence of the profits obtainable from the production of the latter on account of their rise in price, not only will P increase (i.e. the purchasing power of money decline) but I'－S will increase, with the result that P will increase (temporarily) by more than M1.V1/O has increased.
Thus the effect of the new money in the first instance isㅡunless it is needed to balance changes in V1 or V2:
In the last three cases P rises and to a greater extent, in the first instance, than can be accounted for by any increase in M1.V1/O. Nevertheless, so long as P' > P or P > M1.V1/O , there can be no position of equilibrium. For the increase of P' relatively to P and the increase of P, in so far as it is due to an increase in I'－S, cause profits, and thereby stimulate entrepreneurs to improve their bids for the services of the factors of production. This must continue until M1.V1/O has settled down at a higher figure, which is in equilibrium with values of P and P' which are enhanced relatively to their old values in a degree corresponding to the amount by which M1.V1/O has been increased.
(3) The Problems of the Transition (p. 269)
We have seen that the price-level will have responded to the increased (or decreased) quantity of money as soon as the second term of the Fundamental Equation is affected. Thus the effect of the new money on prices will be rapid. But, as we have also seen, we must not, therefore, assume that a new equilibrium has been established at this stage. So long as entrepreneurs are enjoying windfall profits (or losses), the position is unstable. If it is a case of profits, they bid against one another for the services of the factors of production, until the latter have risen to a level at which costs of production and sale proceeds are again equal. If it is a case of losses, they throw factors of production out of employment until the latter agree to accept a rate of remuneration at which the costs of production no longer exceed the sale proceeds. Only when the stimulation (or retardation) of investments has worked itself out in an increase (or decrease) of M1.V1 will the lending capacity of the banks be again restored to equilibrium with saving (for the excess loans will be balanced by the accrual of profits at the end of each production period and will, therefore, be again available, direclty or indirectly, for the next production period) and with the task of furnishing an Industrial Circulation appropriate to the now increased (or decreased) earnings-bill. But, finally, the second term (I'－S)/O will have to fall back again to zero; the banks no longer commanding a surplus lending power wherewith to stimulate investment to outstrip savings (or vice versa). A new equilibrium will have been established with both P and M1.V1/O at a higher (or lower) level corresponding to the increased (or decreased) volume of money.
It must not be supposed, however, that this transition from an enhancement of prices as a result of an increase in the second term of the Fundamental Equation to their enhancement as a result of an increase in the first term will necessarily take place smoothly. If it is a case of reducing the rate of earnings, the factors of production may resist the fall, with the result that their period of unemployment may be prolonged. Moreover investment may continue to exceed (or fall short of) saving ^after^ what should be a sufficient alteration of M1.V1 has taken place, with the result of driving prices to a higher (or lower) value than can be permanently sustained. Thus a series of minor oscillations backwards and forwards will be set up before the final position has been reached.
Furthermore, if we are not dealing with a closed system, part of the initial increase (or decrease) in the supply of money relatively to the demand at the old equilibrium will probably be obliterated by an export or import of gold. Forㅡto take the case of an increased supplyㅡthe easier terms for lending will tend to increase Foreign Lending, whilst the Foreign Balance, so far from increasing so as to balance this, will tend to diminish under the influence of the rising domestic price-level.
Since the movement of gold will tend to reproduce abroad (though presumably on a relatively smaller scale) the same situation as at home, the effect of the above will be to diffuse the effects of the change of the supply of money over a wide area and so diminish their degree.
If, however, the increased supply of money is in fact due to an import of gold, resulting from a previous excess of the Foreign Balance over Foreign Lending, then the changes at home, which this import of gold sets in train, will all be in the direction of restoring, instead of disturbing, our country's external equilibrium.
We may remark that there is an element of disequilibrium which may continue even when ^average^ efficiency-earnings have been reduced to a level which is in equilibrium with the reduced volume of money. ( ... ... ) p. 271.
Obviously, the first effect of a new loan by a bank is to increase the deposits of the borrower by the amount of loan. Now it is uncommon for a borrower to borrow, not for any business or investment purpose, but to meet his personal expenditure on consumption;ㅡat any rate, bank loans of this kind are so small a proportion of the whole that we can in general neglect them. Further, it would be unusual to borrow merely in order to add the money to the Savings-deposits, since the interest payable by borrowers always exceeds the interest allowed to depositors; so that this contingency also we can neglect. Generally speaking, therefore, the proceeds of a new loan are added in the first instance to the Business-deposits.
Some part of this addition to the Business-deposits will probably find its way, more or less directly, into the hands of entrepreneurs, who are encouraged by the easier terms of borrowing, to be used by them to meet an increased earnings-bill M1.V1. This increased earnings-billㅡas we have seen aboveㅡmay or may not be associated with an increase in M1.V1/O, the rate of efficiency-earnings. Thus a part of the new money will quickly find its way from M2 into M1, the Income-deposits, and a corresponding part will remain in the Business-deposits A to look after the increased turnover of the entrepreneurs corresponding to their increased earnings-bill. Some small increase in Business-deposits A may also be required as a result of the emergence of profits.
The rest of the addition to the Business-depositsㅡwhich may conceivably amount in the first instance to the whole of the additional moneyㅡwill fall into the hands of speculators and financiers, i.e. of persons who wish to buy commodities or securities with borrowed money. This will raise the price of securities, and the boom in securities thus brought about will probably increase the Stock Exchange turnover. Thus a part, but usually a very small part, of the new money will have to be retained in the Business-deposits B to look after the increased money-turnover of securities. Now for every buyer of a security (or commodity) there must be a seller. The seller may use the proceeds to buy some other security, in which case the rise in price of securities will spread from one category to another. But as the price of securities continues to rise, one or other of two thing must, sooner or later, happen. It may be that this price-rise will furnish windfall profits to the producers of ^new^ investments, with the result that, ^via^ the new issue market or otherwise, increased funds will reach the hands of entrepreneurs for the purpose of increasing, or endeavouring to increase, the output of investment. The further course of events will then be the same as in the case already considered.
The other alternative is that the rising prices of securities will cause a difference of opinion to develop between two sections of the financial community,ㅡone section (the "bulls") believing in the continuance of the price-rise and willing to buy with borrowed money, the other section (the "bears") doubting the continuance and preferring to sell securities for cash or bills or other liquid assets. Or, in so far as the banks are themselves buying securities, it will be sufficient if a "bear" position develops. Now in so far as the bears' funds are lend to the bulls otherwise than through the Banking System, the Stock Exchange boom can continue with the aid not only of the new money but also of the proceeds of the bears' sales. But in so far as the bears add the proceeds of their sales (or of their refraining from buying securities with their current savings) to the Savings-deposits, this uses up part of the new money in appropriately increasing M3.
Thus all the new money will eventually find its way either to M1, corresponding to (1) the increased earnings-bill M1.V1, or to M2 to look after either (2) the increased entrepreneurs' turnover or (3) the increased Stock Exchange turnover, or to M3 to provide for (4) the enlargement of the "bear" position.
Now so long as the new money is absorbed by (3) and (4), without, however, stimulating the output of new investment, there will be no effect on the purchasing power of money, since, although I (the value of the output of new investment) will have increased, I' (the cost of this output) will not have increased. But in so far as the earnings-bill M1.V1 is increased, and also in so far as entrepreneurs change over from the production of consumption-goods to that of capital-goods under the influence of the profits obtainable from the production of the latter on account of their rise in price, not only will P increase (i.e. the purchasing power of money decline) but I'－S will increase, with the result that P will increase (temporarily) by more than M1.V1/O has increased.
Thus the effect of the new money in the first instance isㅡunless it is needed to balance changes in V1 or V2:
- (ⅰ) To increase M3, M2 and P' (the price-level of new investment-goods), whilst leaving I'－S, M1.V1 and P unchanged ; or
- (ⅱ) To increase I'－S and P, whilst leaving M1.V1 unchanged ; or
- (ⅲ) To increase I'－S, M1.V1 and P, whilst leaving M1.V1/O unchanged ; or
- (ⅳ) To increase I'－S, M1.V1, M1.V1/O and P.
In the last three cases P rises and to a greater extent, in the first instance, than can be accounted for by any increase in M1.V1/O. Nevertheless, so long as P' > P or P > M1.V1/O , there can be no position of equilibrium. For the increase of P' relatively to P and the increase of P, in so far as it is due to an increase in I'－S, cause profits, and thereby stimulate entrepreneurs to improve their bids for the services of the factors of production. This must continue until M1.V1/O has settled down at a higher figure, which is in equilibrium with values of P and P' which are enhanced relatively to their old values in a degree corresponding to the amount by which M1.V1/O has been increased.
(3) The Problems of the Transition (p. 269)
We have seen that the price-level will have responded to the increased (or decreased) quantity of money as soon as the second term of the Fundamental Equation is affected. Thus the effect of the new money on prices will be rapid. But, as we have also seen, we must not, therefore, assume that a new equilibrium has been established at this stage. So long as entrepreneurs are enjoying windfall profits (or losses), the position is unstable. If it is a case of profits, they bid against one another for the services of the factors of production, until the latter have risen to a level at which costs of production and sale proceeds are again equal. If it is a case of losses, they throw factors of production out of employment until the latter agree to accept a rate of remuneration at which the costs of production no longer exceed the sale proceeds. Only when the stimulation (or retardation) of investments has worked itself out in an increase (or decrease) of M1.V1 will the lending capacity of the banks be again restored to equilibrium with saving (for the excess loans will be balanced by the accrual of profits at the end of each production period and will, therefore, be again available, direclty or indirectly, for the next production period) and with the task of furnishing an Industrial Circulation appropriate to the now increased (or decreased) earnings-bill. But, finally, the second term (I'－S)/O will have to fall back again to zero; the banks no longer commanding a surplus lending power wherewith to stimulate investment to outstrip savings (or vice versa). A new equilibrium will have been established with both P and M1.V1/O at a higher (or lower) level corresponding to the increased (or decreased) volume of money.
It must not be supposed, however, that this transition from an enhancement of prices as a result of an increase in the second term of the Fundamental Equation to their enhancement as a result of an increase in the first term will necessarily take place smoothly. If it is a case of reducing the rate of earnings, the factors of production may resist the fall, with the result that their period of unemployment may be prolonged. Moreover investment may continue to exceed (or fall short of) saving ^after^ what should be a sufficient alteration of M1.V1 has taken place, with the result of driving prices to a higher (or lower) value than can be permanently sustained. Thus a series of minor oscillations backwards and forwards will be set up before the final position has been reached.
Furthermore, if we are not dealing with a closed system, part of the initial increase (or decrease) in the supply of money relatively to the demand at the old equilibrium will probably be obliterated by an export or import of gold. Forㅡto take the case of an increased supplyㅡthe easier terms for lending will tend to increase Foreign Lending, whilst the Foreign Balance, so far from increasing so as to balance this, will tend to diminish under the influence of the rising domestic price-level.
Since the movement of gold will tend to reproduce abroad (though presumably on a relatively smaller scale) the same situation as at home, the effect of the above will be to diffuse the effects of the change of the supply of money over a wide area and so diminish their degree.
If, however, the increased supply of money is in fact due to an import of gold, resulting from a previous excess of the Foreign Balance over Foreign Lending, then the changes at home, which this import of gold sets in train, will all be in the direction of restoring, instead of disturbing, our country's external equilibrium.
We may remark that there is an element of disequilibrium which may continue even when ^average^ efficiency-earnings have been reduced to a level which is in equilibrium with the reduced volume of money. ( ... ... ) p. 271.
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