This chapter explores the different explanations of Ricardo and Thornton for the depreciation of sterling after convertibility of sterling into gold was suspended during the Napoleonic Wars. Ricardo held that only overissue by the Bank of England could have caused depreciation of sterling while...

While Hayek's Prices and Production established his reputation as a business-cycle theorist, Sraffa's 1932 review of the book helped turn professional opinion against him. A key criticism of Sraffa was that Hayek's conception of a natural rate of interest, reflecting only real relationships, was...

This paper uses the Fisher equation relating the nominal interest rate to the real interest rate and expected inflation to provide a deeper explanation of the financial crisis of 2008 and the subsequent recovery than attributing it to the bursting of the housing-price bubble. The paper...

The response of nominal and real interest rates to expected deflation becomes problematic when nominal interest rates fall toward zero while the expected rate of deflation is increasing. As nominal interest rates approach their lower bound, further increases in expected deflation cannot cause...