(Correspondent: Wang Tianjian) Recently, Assistant Professor Liang Junshang of our school attended the Annual Meeting of the Allied Social Science Associations (ASSA) held in San Antonio, U.S., and presented his working paper Economic Structure and Fluctuation of Money Supply: Based on Marx’s Idea of the “Setting Free of Money Capital”.

This paper builds mathematical models for the process of the “setting free of money capital” introduced in the second volume of Capital. According to Marx, the money capital temporarily discharged from the process of capital turnover is of great significance to the establishment and operation of the credit system. Saros (2008) believes that the “setting free” of money capital serves as an important source of money supply, and its fluctuation would give rise to the fluctuations in financial markets, and would thereby affect the operation of the financial system. Through mathematical analysis and numerical simulation, this paper further reveals that the “setting free” of money capital and the mode of money supply fluctuation are subject to economic structures. For example, a more centralized distribution of total social capital results in a more significant amplitude of fluctuation in macro money supply and the faster turnover of social capital leads to higher frequency of the fluctuation. Therefore, the change in the economic structure plays a significant role in the fluctuation of the money supply.