• Ole Bjerg

    Ole Bjerg is Professor at the Department of Management, Politics and Philosophy at Copenhagen Business School. He is the author of Parallax of Growth – The Philosophy of Ecology and Economy (Polity Press 2016), Making Money – The Philosophy of Crisis Capitalism (Verso 2014), Poker – The Parody of Capitalism (Umich Press 2011) as well as the three books in Danish including one on money and monetary reform. Ole Bjerg is also the co-founder of a NGO working on monetary reform called Gode Penge.

Seigniorage in the 21st century: profits from money creation

Abstract: This paper develops a new theory of seigniorage suited to modern economies where the majority of money is created not by the state or central bank but by commercial banks and other monetary financial institutions via their lending activity. We identify four different forms of seigniorage that take account of the modern institutional separation between the state, the central bank, commercial banks and the non-bank private sector in terms of their identities as ‘money creators’ and ‘money users’. The new typology differentiates between seigniorage profits arising from interest rate spreads on stocks of created money and profits arising from flows of interest payments on newly created assets. We illustrate our theoretical framework with empirical data on commercial bank seigniorage and related variables in the United Kingdom and the Denmark over the past quarter century.

Download the full paper as pdf:  Seigniorage in the 21st Century: A study of the profits frommoney creation in the United Kingdom and Denmark

A list of more papers of Ole Bjerg might be found hier.

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