Gesell’s half a theory of the rate of interest: The Keynes-Hochstetter correspondence

This article discusses previously unpublished correspondence between Keynes and the German economist Franz Hochstetter, a strong supporter of Silvio Gesell. The correspondence debates the reasons why Keynes deemed Gesell’s theory of the rate of interest as incomplete, and his plan of stamped money as impractical. The issue is analysed by referring to the more general theme of the inconsistencies in Keynes’s interest theory, and the unsuccessful attempts he made to strengthen its foundations.