The term wasn't coined by him. The phenomenon was first described by him; hence it was named after him.
The term wasn't coined by him. The phenomenon was first described by him; hence it was named after him.
>The Cantillon Effect is a term coined by Richard Cantillon, a French banker and philosopher in the 18th century.3 It describes the uneven expansion of the amount of money in an economy, resulting in a distortion in relative prices that benefits certain parties while disadvantaging others. When new money is injected into the economy, it naturally raises the price of goods and assets, but not all prices will rise by the same amount or at the same time. The Cantillon Effect asserts that the first recipient of the new supply of money has an arbitrage opportunity of being able to spend money before prices have increased.2 The Austrian economist Friedrich August von Hayek compared this monetary expansion with honey.0 The Cantillon Effect has been compared to the Nakamoto effect, which is a change in relative prices resulting from a shift in money supply.1
>>The Cantillon Effect is a term coined by Richard Cantillon, a French banker and philosopher in the 18th century.3 It describes the uneven expansion of the amount of money in an economy, resulting in a distortion in relative prices that benefits certain parties while disadvantaging others. When new money is injected into the economy, it naturally raises the price of goods and assets, but not all prices will rise by the same amount or at the same time. The Cantillon Effect asserts that the first recipient of the new supply of money has an arbitrage opportunity of being able to spend money before prices have increased.2 The Austrian economist Friedrich August von Hayek compared this monetary expansion with honey.0 The Cantillon Effect has been compared to the Nakamoto effect, which is a change in relative prices resulting from a shift in money supply.1
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