The State, the Market and the Euro

Is the theory of money that underlies most modern macroeconomics well-grounded? What determines the value of a currency, and how is the state's power over its currency related to its ability to stabilize prices and employment? Charles Goodhart's classic paper "The Two Concepts of Money: Implications [...]
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Is the theory of money that underlies most modern macroeconomics well-grounded? What determines the value of a currency, and how is the state's power over its currency related to its ability to stabilize prices and employment? Charles Goodhart's classic paper "The Two Concepts of Money: Implications for the Analysis of Optimal Currency Areas" which first raised these questions is reprinted here, and the distinguished authors expand its line of argument and comment on its central themes. The issues discussed are of fundamental importance in contemporary monetary theory and policy.