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The Roman monetary system was historically unique. Its complexity arose out of several intersecting and sometimes contradictory embedding contexts. This chapter identifies several important embedding contexts and provides a broad diachronic outline of their influence in the development of Roman money. Some of Rome’s Republican-era experiments with coinage, for example, were inescapably influenced by Greek practices and concepts. Roman territorial expansion seems to have been correlated with the rise of impersonal exchange in Rome, Italy and beyond – presenting unique cultural challenges for Roman elites in the Republican period. Notions of monetary value in the Roman Principate remained tethered to historical monetary contexts – but shifts in value and in the prominence of certain contexts over others could and did happen. Oscillations in the intensity and breadth of state power, for example, influenced money use, value and the scope for market exchange. It is impossible to import modern economic theory into Roman monetary history without first accounting for some of the key embedding contexts which shaped monetary practices, processes and concepts in the Roman world.
All historical applications of formal economic models require justification – not merely within their own closed system of logic, but in a wider historiographical context which includes serious and thoughtful substantivist critiques of the formalist enterprise more generally and especially of applied economic theory. Even if new institutional economics is not the solution, are there other ways Roman economic historians might use economic theories to better understand the economic choices made by the inhabitants of the ancient world as well as the embedding contexts which channeled such choices? History and economics, despite fundamental differences embedded in each discipline, can meaningfully and symbiotically intersect. Economics offers Roman historians valuable and helpful organizing concepts, so long as these concepts are used within an agenda of historical understanding.
The assumptions built into the quantity theory of money severely limit its usefulness for studying the Roman monetary system if not all pre-industrial monetary systems. Quantity theory fails to account for the complexity and disaggregated nature of the Roman monetary economy. This chapter, instead, disaggregates the workings of the monetary system by considering both money quantity and quality, the spatial and temporal properties of money and, finally, money’s value as a product of the subjective preferences of individuals. Instead of assuming money is neutral, Roman economic historians can and should examine the specific channels through which money entered the Roman economy. Depending upon the location of these channels in the larger political, cultural and social matrix, as well as the amount of money distributed through them, it may be possible to understand the human responses to money supply changes in the Roman world as well as the wider effects of these changes – effects which include not only price movements and the shifts in the structure of production but also realignments in social hierarchies.
This paper estimates an enriched version of the mainstream medium-scale dynamic stochastic general equilibrium model, which features nonseparability between consumption and real money balances in utility and a systematic response of the policy rate to money growth. Estimation results show that money is a significant factor in the monetary policy rule. As a consequence, econometric analysis that omits money from Taylor rules may lead to biased estimates of the model parameters. In contrast to earlier studies that rely on small-scale models, the paper stresses the merits of using a sufficiently rich model. First, it delivers different results, such as the role of nonseparability between consumption and money in utility. Second, the rich dynamics embedded in the model allow us to explore the responses of a larger set of macroeconomic variables, making the model more informative on the effects of shocks and more useful for understanding the sources of business cycles. Third and most importantly, it reveals the possible pitfalls of relying on small-scale models when studying money’s role in business cycles.
Civil forfeiture is an asset forfeiture mechanism available to seize proceeds of crime. Kenya has embraced its use and provides statutory mechanisms for its implementation. The Proceeds of Crime and Anti-Money Laundering Act is the main statute in this regard. This article examines the substantive law and procedure for civil forfeiture provided in this statute. The analysis indicates that the provisions are technical in nature and that the process is systematic. This ensures a procedurally and substantively fair process before an individual's property is seized. This approach aims to safeguard against the arbitrary deprivation of property. Nonetheless, challenges are identified that interfere with the effective implementation of the civil forfeiture regime. These problems lead to the current underutilization of the regime. Accordingly, the article identifies viable ways of addressing these shortcomings. Implementation of these suggestions could enhance the use and success of civil forfeiture in dealing with the proceeds of crime.
The ‘āqila -- a group of men liable for the payment of blood money on behalf of any of them -- is based on collective liability. When the Shari‘a borrowed this institution from pre-Islamic, tribal custom, a contradiction was created with the Islamic important principle of individual responsibility. This chapter focuses on this contradiction, examining the means by which Muslims jurists attempted to settle, reduce, or justify the paradox, and how these efforts contributed to shaping the law. One way was to restrict the liability of the ‘āqila to accidental homicide, leaving the perpetrator alone liable for intentional homicide. Another solution was to develop arguments that either denied the contradiction or enhanced the importance of the ‘āqila to justify the existence of the institution despite the contradiction involved. It is argued that the changes introduced in rules related to the ‘āqila, and the proposed justifications, brought homicide, which in pre-Islamic Arab custom was treated as a tort, closer to a crime.
This chapter follows the process by which Muslim scholars introduced the innovative Umayyad practice of blood-money payment into the Shari‘a. It focuses on the literature of the Ḥanafī school, the only school that incorporated the Umayyad regulation, and reveals how the Ḥanafīs Islamized the Umayyad practice by attributing it to weighty religious authorities from the past, particularly to the second caliph ʿUmar b. al-Khaṭṭāb. The chapter offers a close examination of the arguments and the ḥadīths that served to substantiate the transformation of the Umayyad practice into a Sharʿi rule.
This chapter offers a full picture of the modifications that the Ḥanafī jurists introduced in the method of blood-money payment, basing on Umayyad practice and regulations. It suggests that these Ḥanafī jurists broadened significantly the Umayyad innovation of the method of payment, by changing also the composition of the ‘āqila. They removed the liability for blood money from the perpetrator's kinsmen, transferring it to the warriors of his military division who were registered with him on the same payroll of the dīwān. Together with other changes motivated by administrative considerations, the Ḥanafīs transformed the ‘āqila from a tribal solidarity group of limited size, into a group of thousands of men who shared no blood ties. The payment of blood money, previously the most important expression of solidarity, became a compulsory toll, which the government could levy by deduction from a large group, selected according to its own considerations.
This chapter describes how, shortly after the advent of Islam, the ultimate responsibility for blood-money payment was transferred to state administration, and how the method of payment was modified accordingly. With a view to assisting the ruler supervising the payments, the Umayyads regulated that instead of direct payment by the ‘āqila, the injured party were to receive their dues from money deducted from the annual stipends to which the ‘āqila members were entitled by virtue of their being registered in the military dīwān, the Muslim army. The introduction of this Umayyad innovation by the caliph Mu‘awiyya is presented, as well as historical evidence of its actual practice throughout the Umayyad empire.
This paper shows that money is a relevant macroeconomic indicator for the description of US monetary policy with simple rules. Empirical analysis based on novel real-time data reveals the economically and statistically significant effect of money on the federal funds rate during the Volcker–Greenspan era, highlighting an interest rate rule that better explains historical policy. The findings suggest that the bias against including money in mainstream macroeconomic models may be due to relying on an incorrect measure of money. A gradual deviation from this rule explains loose monetary policy prior to the Great Recession. Including money aggregates in rule-based policy presents a suitable framework to evaluate and guide Federal Reserve policy.
This chapter considers the financial management of the English convents in Catholic Europe. It places the convents’ economic dealings in the context of their overall history, underlining just how vital this aspect of convent life was to their very survival and function. This chapter starts by briefly considering the nuns’ devotion to poverty, before exploring some of the necessary expenses accrued by the foundations. The different economic income strands exploited by the English convents is then outlined, before some of the problems they experienced in their finances are explored. The chapter finishes with a consideration of whether the convents were ever able to separate completely from their English roots as far as finances were concerned. Though the English convents adopted similar approaches to financial management as their continental equivalents and were frequently the model of Tridentine economic behaviour, they did face additional problems as a result of their nationality. Ultimately, the English convents existed in a precarious economic zone that could easily fall prey to both domestic and international fluctuations in more than just the economic environment.
This chapter focuses on the concept of time to evaluate the barriers and opportunities to environmentally responsible finance, and to assess existing governance reforms. With the sustainability discourse increasingly penetrating the financial economy, some investors and lenders profess to be more mindful of the value of long term and patient financial decisions, both for their own economic returns and environmental responsibility. However, the system of global finance capitalism, with its myopic and frenetic tempo, clashes with this aspiration. The movement for socially responsible investing, and the associated 'slow money' movement, are helping to inculcate more eco-friendly time-scales into the financial world. These movements are emerging agents of environmental governance, helping to overcome the lacunae and deficits in official regulation of the financial sector's environmental performance.
In this paper, we are motivated by the fact that little is known about the relative performance of broad and narrow Divisia monetary aggregates, and by recent work that tests and rejects the appropriateness of the aggregation assumptions that underlie the various monetary aggregates published by the Federal Reserve as well as a large number of monetary asset groupings suggested by earlier studies. We present a comprehensive comparison of narrow versus broad Divisia monetary aggregates within three classes of empirical models. We compute correlations between the cyclical components of Divisia monetary aggregates at different levels of aggregation and the cyclical component of industrial production. We test for Granger causality running from the Divisia aggregates to industrial production and various other measures of real economic activity. We also reestimate a structural vector autoregression based on earlier work by Leeper and Roush [(2003) Journal of Money, Credit, and Banking 35, 1217–1256] and Belongia and Ireland [(2015) Journal of Business and Economic Statistics 33, 255–269; (2016) Journal of Money, Credit and Banking 48, 1223–1266], modifying that earlier work using monthly rather than quarterly data and extending it, both using broad as well as narrower Divisia monetary aggregates and by allowing for Generalized autoregressive conditional heteroskedasticity (GARCH) behavior in the structural shocks.
Behavioral paternalists accept the neoclassical standard of rationality for normative purposes, even while questioning its descriptive accuracy. However, these standards do not have a strong normative justification. There are many perfectly reasonable ways the neoclassical norms can be violated without hurting the interests of individuals. Redescribing preferences or actions to fit the well-behaved mold is essentially arbitrary and without, in itself, any normative significance. Even demonstrating that individuals have inconsistent preferences does not tell us which preferences are better or represent “true preferences.” Behavioral paternalists commit a non sequitur when they use inconsistency to justify privileging some preferences over others.
In the framework of a critical illustration of the contemporary history of economics, this chapter provides an (original) illustration of Hayek’s thought: his formative years, his contributions to the theory of the trade cycle and the theory of capital and the subsequent debates with Sraffa and Kaldor, his theory of the spontaneous order and of the market as a mechanism of knowledge diffusion, his political individualism and the similarities/differences to the notions of methodological individualism , liberism and liberalism, his thesis on the denationalization of money.
In the framework of a critical illustration of the contemporary history of economics, this chapter presents a general picture of developments in monetary theory and in the theory of financial markets, beginning with the monetarist approach. The transition in the policy field from domination of the Keynesian to domination of the monetarist approach is then illustrated. The theory of efficient financial markets is then considered, from the Modigliani–Miller theorem to Fama’s contribution. A section is devoted to various issues in the theory of financial markets and institutions, as an introduction to Minsky’s ‘truly Keynesian’ analysis of financial markets and their fragility as the repeated origin of crises. Finally, Minsky's idea of a new stage in the development of capitalism, the so-called money managers capitalism, is recalled.