Richard Kerschagl: Universalismus und Individualismus in der Methodik der Geldtheorie (1921)

Richard Kerschagl’s Universalismus und Individualismus in der Methodik der Geldtheorie. Versuch einer dogmengeschichtlichen und wirtschaftstheoretischen Kritik combines a history of monetary doctrines with an argument for understanding money through the interdependence of production, consumption, and distribution. Its distinction between universalism and individualism cuts across the opposition between metallism and chartalism. The decisive question is not simply what money consists of, but how it functions within an economic community.

The historical argument begins with the prolonged dominance of commodity conceptions:

Im allgemeinen aber kann man sagen, daß die Auffassung des Geldes als Ware, wozu allerdings auch die ausschließliche Edelmetallqualität des damaligen Geldes beitrug, die Erkenntnis vom wahren Wesen des Geldes fünf Jahrhunderte lang aufhalten konnte.

English translation: In general, however, one may say that the conception of money as a commodity — to which, to be sure, the exclusively precious-metal quality of the money of that time also contributed — was able to hold back the recognition of the true essence of money for five centuries.

Kerschagl treats this dominance as a methodological restriction, not merely a mistaken preference for precious metals. By approaching money through exchange and its material properties, theorists neglected the social unity that monetary relations express. He connects classical economics’ individualistic assumptions with its liberal historical setting. Adam Müller supplies an important alternative: money represents an economic whole, and its independent valuation as a commodity can interfere with that representative function.

Knapp’s state theory receives qualified approval because it explains money’s institutional constitution without making metallic substance decisive. Kerschagl nevertheless distinguishes this static achievement from an explanation of money’s changing effects on economic life:

Die dynamische Seite des Geldproblems in seiner rein soziologischen Erscheinung als Verteilungsproblem hätte wohl noch mehr eines Forschers bedurft, der eine Lösung im universalistischen Sinne versucht hätte.

English translation: The dynamic side of the money problem in its purely sociological manifestation as a problem of distribution would surely have stood in still greater need of an investigator who would have attempted a solution in the universalist sense.

Distribution is thus the unresolved test of a universalist monetary theory. Legal recognition can establish a monetary order without explaining how that order mediates claims upon production. Nor does chartalism itself ensure a universalist outlook: defenders of noncommodity money can retain individualistic or nationally competitive policy objectives. Kerschagl’s discussions of Helfferich and Dalberg identify openings toward an account grounded in reciprocal obligations, production, and distribution.

Socialism occupies an instructive position in this survey. Its collective orientation did not automatically produce the monetary theory Kerschagl seeks:

Dies mag sich teilweise dadurch erklären lassen, daß dem Sozialismus das direkte Verteilungsproblem viel mehr am Herzen lag als eine indirekte Lösung von der Geldseite, die er nur als Umweg und vielfach sogar nur als Unaufrichtigkeit betrachtete.

English translation: This may be explained in part by the fact that socialism had the direct problem of distribution much more at heart than an indirect solution from the side of money, which it regarded merely as a detour and in many cases even as nothing but insincerity.

The passage separates concern with distribution from recognition of money’s mediating role. Direct coordination of production and consumption might diminish money’s importance, but eliminating the intermediary could also remove a source of flexibility and make economic disturbances more abrupt.

Bendixen receives sympathetic attention for linking money, understood as a common denominator of values, to goods available for exchange through issuance grounded in commodity bills. Yet Kerschagl separates theoretical insight from practical feasibility. He rejects the viability of converting German war debt into notes while recognizing the underlying attempt to distribute the burden of wartime consumption. Similarly, he questions Gesell’s depreciating currency while valuing the prospect of international monetary cooperation. His criticism of Mises turns on another distinction: failures of state monetary practice do not by themselves refute Knapp’s theoretical explanation.

The second part qualifies any simple identification of metallism with individualism. A metallic basis can constrain issuance within an organically conceived monetary order. More problematic is the demand that money remain an invariant store of value despite changes in production and consumption. Monetary mediation must operate within those changes, not stand outside them.

Kerschagl consequently revises the explanatory priority usually assigned to exchange. Indirect exchange provides a technical condition for money, but the economic units enabled by exchange and the division of labour supply its social explanation. Their expansion toward a world economy calls for cooperation exceeding agreements about coinage. His concluding appeal to subjective value and income formation likewise shifts attention from metallic substance or legal denomination toward money’s economic functions. The work recasts monetary theory as an inquiry into social organization and distribution, while distinguishing that theoretical ambition from confidence in particular monetary reforms.