Although much research has examined the effect of income on happiness, we suggest that how people spend their money may be at least as important as how much money they earn. Specifically, we hypothesized that spending money on other people may have a more positive impact on happiness than spending money on oneself. Providing converging evidence for this hypothesis, we found that spending more o...

Empirical and experimental evidence documents that money illusion is persistent and widespread. This paper incorporates money illusion into a stochastic continuous-time monetary model of endogenous growth. We model an agent’s money illusion behavior by assuming that he maximizes nonstandard utility derived from both nominal and real quantities. Money illusion affects an agent’s perception of th...

Recent work on Ancient Greece sheds light on the origins of money and its effects on economy and society. This review essay analyses such work and relates it to themes familiar to economists. It examines monetary functions in the heroic world and the effects of introducing coinage in Classical Athens. It attends to the role of the state in the development of money and to the form which money to...

The creation and annihilation of money and its economic effects are reviewed. Economic values appear “in the mind” of the market participants; e.g., by pretending, maintaining and achieving a particular price for a certain asset. Upon its creation by banks, this kind of “value phantasy” is converted into “real money” often in terms of buyer’s debt accompanied by a simultaneous payment of fiat m...