Money Is Not a Veil, Exchange Is Not Barter, and Hoarding Is Real: J.-B. Say on Money Holdings
AbstractThe common narrative about Say’s views on money is that money was merely a veil, that all
exchange was ultimately barter, and that he denied the possibility of hoarding. In other words, it
is claimed that for Say money was only a medium of exchange. Statements to that effect abound
in scholarly publications and economic textbooks. By means of textual and contextual analysis, I
argue that these interpretations of Say’s thinking are superficial, and for the most part, erroneous.
In reality, not only did Say analyze hoarding, but more generally, Say admitted that monetary
changes could affect real variables and the distribution of wealth. I show that Say’s ideas have
been misconstrued for two reasons. First, most studies have assessed Say’s monetary views
through the narrow lens of the so-called “Say’s law”. Second, they have failed to engage with
Say’s writings in their entirety. The picture that emerges from this essay shows that Say was far
from naive on monetary questions.