dos Anjos, Moacir Tavares Rodrigues; (1994) Money, social cohesion and inflation: The Brazilian economy in the 1980s. Doctoral thesis (Ph.D), UCL (University College London).

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Abstract

The importance of money for the reproduction of modern capitalist economies is commonly neglected by neoclassical economics. This thesis proposes an alternative view in which money is understood as an institution which provides some of the necessary conditions for the generation of productive wealth in capitalist economies. Moreover, as the productive circuit is one of the spheres of modern capitalist economies in which private and social aims are made compatible, money is presented as an element of social cohesion. Both the emergence and the maintenance of the institutional character of money are assessed by resorting to distinct but compatible approaches to money (economic, sociological and anthropological). The thesis examines the importance of the main functions of money for the activation of the productive process and develops the concept of unity of the functions of money. As opposed to the merely descriptive analyses of those functions made in textbooks, this approach emphasises their conventional nature and argues that only if the monetary unity is maintained can money operate as a social institution. It is shown both how accelerating inflation menaces the unity of the functions of money and how modern capitalist economies continually adapt their institutions and behaviours to overcome such disturbing effects. A qualitative taxonomy of inflation (low, high and hyperinflation) is proposed to demonstrate the limits of those adapted economies (low, high and hyperinflation regimes) to maintain the unity of the functions of money if inflation persists in accelerating. The institutions required to stabilize an economy whose monetary unity is threatened are also discussed. This theoretical framework is used to appraise the Brazilian monetary crisis in the 1980s as a process of progressive rupture of the unity of the functions of money. Such assessment traces the origins of the Brazilian high inflation regime in the mid-1960s and shows how contradictions evolved over the years made it a self-defeating regime in the 1980s, eventually destroying the role of money as an element of social cohesion.

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