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This optimal ratio depends on considered
ReplyDeletewhether the isolated country or its system of foreign trade. If
that was part of the state, which would be able to live on
their funds, it is found that the amount of money
required for the treatment depends on many variables:
the quantity of goods entering into the exchange system; parts of these
merchandise which, being neither sold nor bought in
the exchange must be at some point of its movement
presented by means of money; amount of metal, which
can replace paper; finally, the rhythm in which
paid out: indifferent, as it says
Cantillon<$FC a n t i l l o n. Essai sur la nature du commerce en
generale, ed. 1952, p. 73.>, whether workers are paid at the end
the week or day, whether the rent is paid at the end of the year or sooner
as is customary, at the end of each quarter. When the value of these
four variables are defined for the country, you can
to determine the optimal number of metallic money. Below
to make this calculation, Cantillon comes from products
of the earth, which serves as a source of wealth directly or
indirectly. These products are divided into three types of rent in
the hands of the farmer, the rent paid to the owner; the rent
spent on the workers and horses; finally, the "third
rent, which shall he retained as profit from
his works"<$FId., ibid., p. 68--69.>.