Throughout the history of monetary thought, economists have predominantly emphasised the function of money as a medium of
exchange along with the intrinsic properties that enhance its saleability and credibility as the most liquid store of value.
But the social institution of money co-evolves with technology. It is significant that the advent of digital crypto currencies
was initiated by computer scientists and has taken economists completely by surprise. As a consequence, it also forces our
profession to rethink the basic phenomenology of money. In accordance with the views of Wieser and Schumpeter, digitization
brings to the fore the immaterial function of money as a standard of value and social technology of account, which increasingly
absorbs its function as a medium of exchange. The potential impact of this on economic policy is huge. The variety of different
crypto coins has proven the technical feasibility of competing private currencies as proposed by Hayek. In the long term,
however, there is reason to doubt the persistence of intense competition. One must fear that major digital platforms will
extend their current dominance in multisided virtual marketplaces to include digital payments and money. Central banks are
increasingly anxious to preserve public sovereignty over the common unit of account and are considering issuing their own
digital fiat money. After the current era of intense creative experimentation, the potentially new spontaneous order of private
crypto currencies is likely to be supplanted by central bank digital currencies (CBDCs), the design of which will depend on
deliberate public choices and policies.
Forschungsbereich:Industrie-, Innovations- und internationale Ökonomie