The Future of Money in the Information Age

The Cato Institute's 14th Annual Monetary Conference, "The Future of Money in the Information Age," was held in Washington on May 23. Economists, bankers, entrepreneurs, and Federal Reserve Board officers discussed how electronic cash and other new technologies may change monetary activities and policy. Speakers included Lawrence H. White, professor of economics at the University of Georgia; Richard Rahn, president and CEO of Novecon Ltd.; Rosalind Fisher, executive vice president of VisaNet Services for Visa U.S.A.; William Melton, founder and CEO of CyberCash; David Chaum, founder and managing director of DigiCash; Bill Frezza, president of Wireless Computing Associates; and Scott Cook, cofounder and chairman of Intuit. Excerpts from their presentations follow.
Lawrence H. White: Suppose that analog currency (coins and paper money) does disappear from common circulation. Will that usher in a world without money, as some writers have suggested? No. Rather, it will "merely" undo the current government monopoly of currency. It will return us to a world where the commonly seen money is privately issued, as it was in sophisticated economies 150 years ago where gold coin was seldom seen outside bank vaults despite being the ultimate money of redemption for deposits and bank notes.