Seminar on Monetary Theory (2024/25)

What turns an ordinary piece of paper or digital bits into money? What role does it play in the economy and why is it valuable? And above all: how is its value determined? To answer these questions, the seminar introduces and compares three theories of the value of money — the Quantity Theory, the Fiscal Theory of the Price Level (FTPL), and Modern Monetary Theory (MMT). Each theory is presented by a student team and then tested against historical episodes of inflation and deflation, from the German hyperinflation of the 1920s and the Great Depression to the zero lower bound after the financial crisis and the 2022 inflation surge.