Prices and Production by F.A. Hayek

Author:F.A. Hayek [Hayek, F.A.]
Language: eng
Format: epub, pdf
Publisher: Ludwig von Mises Institute

MONETARY NATIONALISM AND INTERNATIONAL STABILITY

Preface

The five lectures which are here reproduced are necessarily confined to certain aspects of the wide subject indicated by the title. They are printed essentially as they were delivered and, as is explained in the first lecture, limitations of time made it necessary to choose between discussing the concrete problems of the present policy of monetary nationalism and concentrating on the broader theoretical issues on which the decision between an international standard and independent national currencies must ultimately be based. The first course would have involved a discussion of such technical questions as the operations of exchange equalization accounts, forward exchanges, the choice and adjustment of parities, cooperation between central banks, etc., etc. The reader will find little on these subjects in the following pages. It appeared to me more important to use the time available to discuss the general ideas which are mainly responsible for the rise of monetary nationalism and to which it is mainly due that policies and practices which not long ago would have been frowned upon by all responsible financial experts are now generally employed throughout the world. The immediate influence of the theoretical speculation is probably weak, but that it has had a profound influence in shaping those views which today dominate monetary policy is not open to serious question. It seemed to me better therefore to concentrate on these wider issues.

This decision has permitted me a certain freedom in the discussion of alternative policies. In discussing the merits of various systems I have not felt bound to confine myself to those which may today be considered practical politics. I have no doubt that to those who take the present trend of intellectual development for granted much of the discussion in the following pages will appear highly academic. Yet fundamentally the alternative policies here considered are no more revolutionary or impracticable than the deviations from traditional practice which have been widely discussed and which have even been attempted in recent years—except that at the moment not so many people believe in them. But while the politician—and the economist when he is advising on concrete measures—must take the state of opinion for granted in deciding what changes can be contemplated here and now, these limitations are not necessary when we are asking what is best for the human race in general. I am profoundly convinced that it is academic discussion of this sort which in the long run forms public opinion and which in consequence decides what will be practical politics some time hence. I regard it therefore not only as the privilege but as the duty of the academic economist to take all alternatives into consideration, however remote their realization may appear at the moment.

And indeed I must confess that it seems to me in many respects the future development of professional and public opinion on these matters is much more important than any concrete measure which may be taken in the near future. Whatever the permanent arrangements in monetary

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