Economics Dictionary of ArgumentsHome
| |||
|
| |||
| Credit: In economics, credit refers to the agreement where a lender provides funds, goods, or services to a borrower with the expectation of future repayment, often with interest. It facilitates deferred payment and supports economic activity by enabling consumption, investment, and business operations without immediate cash outlay, playing a vital role in financial systems and economic growth. See also Money supply, Interest rates._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
| Author | Concept | Summary/Quotes | Sources |
|---|---|---|---|
|
Murray N. Rothbard on Credit - Dictionary of Arguments
Rothbard III 166 Credit/Rothbard: (…) a third type of claim arises from a credit exchange (or credit transaction). In a credit transaction, a present good is exchanged for a future good, or rather, a claim on a future good. >Goods/Rothbard, >Exchange/Rothbard. Prices in such exchanges are determined by value scales and the meeting of supply and demand schedules, just as in the case of exchanges of present goods. >Time preference, >Demand/Rothbard, >Supply/Rothbard. Price/credit: It is evident that the various rates of time preference - ultimately determined by relative positions on individual value scales - will act to set the price of credit exchanges. Moreover, the receiver of the present good - the debtor - will always have to repay a greater amount of the good in the future to the creditor - the man who receives the claim, since the same number of units is worth more as a present good than as a future good. Rothbard III 167 The creditor is rendering the debtor the service of using a good in the present, while the debtor pays for this service by repaying a greater amount of the good in the future. In the meanwhile, however, the claim is in existence, and it can be bought and sold in exchange for other goods. wagon. The price of this exchange will again be determined by supply and demand schedules. Market price/risk: Thus, [A’s] demand for the note (or [B’s] demand to hold) in terms of [goods] will be based on (a) the direct utility and exchange-value of the [good], and (b) the marginal utility of the added units of [(other) good], discounted by him on two possible grounds: (l) the length of time the claim has left until the date of “maturity,” and (2) the estimate of the security of the note. Thus, the less time there remains to elapse for a claim to any given good, the higher will it tend to be valued in the market. When a claim is thus transferred in exchange for some other good (or claim), this in itself is not a credit transaction. A credit exchange sets up an unfinished payment on the part of the debtor;(…)._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Rothbard II Murray N. Rothbard Classical Economics. An Austrian Perspective on the History of Economic Thought. Cheltenham, UK: Edward Elgar Publishing. Cheltenham 1995 Rothbard III Murray N. Rothbard Man, Economy and State with Power and Market. Study Edition Auburn, Alabama 1962, 1970, 2009 Rothbard IV Murray N. Rothbard The Essential von Mises Auburn, Alabama 1988 Rothbard V Murray N. Rothbard Power and Market: Government and the Economy Kansas City 1977 |
||
Authors A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Concepts A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
