Abstract

In Monetary Evolution, Free Banking, and Economic Order, Stephen Horwitz has provided an excellent review of the profound problems in the neoclassical theory of money and an important statement of the alternative Austrian?school approach. However, Horwitz's ?free banking? perspective rests on a false dichotomy between intervention and spontaneous order. In using the extreme case of an entirely undesigned evolutionary process to counter the equally extreme proposition that social order can be wholly designed, Horwitz loses sight of the messy world of intermediate realities and possibilities. Even if money has strong spontaneous qualities, the state may play a vital role in the evolution of the financial system.