Managed Currency

Managed Currency

Managed Currency, one in which the quantity of money in a country is regulated by the monetary authorities. If a currency is 'lull-bodied' (wholly metallic gold or silver) no management is required, because the quantity of money is governed solely by the quantity of the metal available. A shortage of money will tend to depress the general level of prices and decrease costs, increase the profitability of monetary metal production, and thus in time increase supplies. -

Experience suggests that the time lags in this adjustment process are so slow that a wholly metallic money supply cannot meet the needs of a modern economy without undesirable fluctuations in prices and business activity. Hence the attempts to adapt the quantity of money to business needs rather than vice versa. This involves increasing or replacing the metallic money supply by token and bank deposit money as well as other credit instruments. Monetary management raises the question of 'how much', 'when' and 'how'. These aims of management raise difficult problems of the relative desirability of stable, rising or falling price levels, variable or stable foreign exchange rates, the 'political' control of money and so on, which are continually debated by economists, who vary from supporters of wholly managed currencies to others who emphasize the advantages of non-political or 'tutomatic' adjustments of currency systems based on gold. Moneyis 'managed' by the central bank control mechanisms of open market operations, Bank rate, etc. Currency management is now universal, but its problems are not solved. In particular managed currencies tend to be inflationary.

Management Accounting, the application of accounting knowledge to the organization, selection and presentation of accounts to give the managers up-to-date and accurate information about the working of industrial and commercial enterprises and thereby assist them in making the best decisions.

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Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this site is therefore not a final statement of economic doctrine.

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