The Nature of Money

"Ingham’s book is the best overview we’ve got right now, the best single book written on money in the past 25 years. And no one has devoted more of his career and scholarship and time to understanding money than Geoffrey Ingham. I’ve learned an enormous amount from him. He gives a really incredible overview, taking lots of complex histories and summarising them. He presents two main options: a commodity theory of money, and a state/credit theory of money; then he shows his readers why the state/credit theory is better. He folds that into a kind of Keynesian lineage of a state/credit theory. Without Ingham we wouldn’t have gotten some of the other developments that we’ve had in money more recently, modern money theory being the biggest one, with Stephanie Kelton being one of the foremost proponents of MMT today. Kelton is Randall Wray’s student, who’s the first modern money theorist. Wray and Ingham are working at similar times and with similar resources. It’s Wray who discovers Innes, but it’s Ingham puts constructs the two synthetic stories of a history of orthodox money as commodity money and a history of a state/Keynesian/credit theory of money. And it’s an amazingly powerful overview, and I think it gets most things right. It’s a great critique of orthodox theory, it gets to that notion of endogenous money creation, that notion that commercial banks create money. It links a lot of things up. It’s a fabulous book, though I think it misses a couple things and it’s a little dated now. But if you have to have one book that isn’t an old book, it has got to be Ingham’s. Ironically, the best works on money are not written by economists. The economist texts on money are ones like Menger’s On the Origin of Money , from the early 20th century that are giving us the neoclassical story that I think is bogus. Joseph Schumpeter is probably the one economist who does the best work on money in his History of Economic Analysis , but it’s very historical. Ingham, in contrast, is a Cambridge sociologist, who was meant to write a sort of intro sociology text that was going to have just one chapter on money—and as Ingham narrates in the preface to the text, he then spent eight years writing that book. After publishing that book, he spent 20 years developing those ideas and defending his account against other misunderstandings in and around money. So no, Ingham’s work isn’t technical: it’s written by an academic, and sometime situated in those contexts, but it’s very readable without any complex statistics or algebra. Actually nothing on this list is technical or requires a prior understanding of math or stats."