Money and savings: how definitions affect policies January 16, 1991

摘要

The subject of this paper is stated in its title. An attempt will be made to demonstrate how lack of precision in the use of terms leads to lack of precision in theories, which in turn leads to errors or misunderstandings in policies. The case in point has to do with some economic terms most frequently in use - money, credit and savings. The principle, however, applies generally in economics, which uses terms that are also in common use. The varied means and lack of precision that accompany the use of these terms apply also to related terms such as deposits, encaje [bank reserves plus forced investments], and reserves. There are doubtless various reasons why economics is often characterised as an inexact science, but at least one must be the common use of some of its fundamental terms in senses different from their use by professionals. And, it must be admitted, the professional economists do not always concur in the meanings they themselves attach to terms.