This paper describes the features of a monetary economy on the basis of Keynes's distinction between a real exchange economy and a monetary economy. In The General Theory, Keynes identifies the reasons for the non-neutrality of money by highlighting the store of wealth function of money; this...

By accepting the claims of the loanable funds theory, contemporary monetary theory distances itself from Keynes's view of the rate of interest as a monetary phenomenon, and overlooks the arguments Keynes used to respond to the criticism of supporters of the loanable funds theory such as Ohlin...