Question

Critique “chartalism.” What evidence runs counter to the ideas of chartalism?

Answer 1

ANSWER:

Chartalism refers to a descriptive economic theory that provides the detailed procedures as well as consequences of usage government-issued tokens as the unit of money, i.e. fiat currency. Thus fiat currency has exchange value as sovereign holds the power to levy taxes on economic activities payable in the currency it is issued. It is money theory which argues that money originated with states' attempts to economic activity directly instead of a spontaneous solution to the issues with barter or as an approach with which to tokenize debt.

However the evidence that counters to the ideas of chartalism is the continued usage of the Somali shilling as currency in spite of the lack of a functioning central government capable of increasing the taxes. Moreover a cryptocurrency, Bitcoin, that is not originated by a state is an a evidence which criticises the ideas of chartalism