Introducing Modern Money Monopoly (MMM)

By Alex Hofmann

Coming back to Stephanie Kelton’s “A Contest: MMT for Eighth Graders” from last May, we have yet to find a good way of explaining basic modern money concepts to children. I followed the blog thread with much interest, but it seems that the initiative has got stuck on the fundamental challenge of finding child-like analogies for concepts that are too abstract even for well-educated grown-ups. As has been pointed out many times, didactics or ‘framing’ is perhaps MMT’s biggest strategic challenge. 

Looking at my own children, a lot if not most of their learning happens not by chewing on concepts but through play, often enough by integrating recent experiences into their favourite games. Hence, what might work better than verbal explanations is an adaptation of the popular ‘Monopoly’ board game: Modern Money Monopoly (MMM).

Of course, individual features of ‘Monopoly’ have come up here and there as an analogy in various MMT blogs. In this context I should like to refer to J.D. Alt’s interesting piece “Playing Monopolis Monopoly: An inquiry into why we are making ourselves so miserable” which was posted on New Economic Perspectives on 17 May, 2012 in which the author suggests to put ‘Monopoly’ into a modern money context and runs through certain extension of the traditional rules*). Alt’s ‘Monopolis’ and MMM have certain similarities.

However, in order to help children develop a complete understanding of modern money in a playful way it is necessary to turn the original ‘Monopoly’ from a micro-economic ‘money-drop’ view into a game that accurately reflects the use of money, macro accounting and sector balances, albeit in a simplified fashion. The advantage of starting with a well-known family game is that a lot can be taught and learned by comparing the original game with the new rules under MMM.

Before discussing the didactic benefits (and limits) of MMM, I should set out how to play this game:

All you need is a classic ‘Monopoly’ board game (for reasons that I will set out further down, I’d have a slight preference for a more recent version that uses debit cards, but the good old paper money version will do, too). Then, you must make the following changes to the rules (everything else stays as in original):

Objective: Achieve the highest net worth over any period of time or number of rounds which can be determined at the outset of the game. Given rule #6.4 bankrupting your mates is not a suitable goal. In fact, the only monopolist at the table is the gov’t (bank) with its money.

#1 – Getting started

1.1 – Instead of starting with hand-outs of ‘helicopter drops’ of money from the bank as in the original:

1.1.1 – All property cards are distributed roughly equally amongst players;

1.1.2 – Houses and hotels go into a ‘pool’, which belongs to all players;

1.1.3 – No cash is distributed at the start; players do not receive ‘salaries’ when passing ‘GO’

1.2 – Change the composition of the ‘chance’ and ‘community chest’ stacks as follows:

1.2.1 – Take out all ‘money drop’ cards, such as cards which grant presents; prizes; inheritance; dividends, etc.;

1.2.2 – Remove random taxes, penalties, fees etc. since these cards will worsen the deflationary drag on the game;

1.2.3 – “Advance to” cards stay in the game

1.3 – The “Income Tax” spaces on the board shall be ignored (players landing on these spaces are encouraged to ponder the beauty of modern money)

#2 – Players are free to develop their properties right from the start:

2.1 – Take rent (which is receivable even in the event of the owner being in jail);

2.2 – Buy and sell property cards;

2.3 – Build houses and hotels at any time (no need to own a series or to build evenly across each lot);

2.3.1 – Houses and hotels must be acquired from the pool (see #1.1.2);

2.3.2 – When buying from the pool, the proceeds are evenly divided amongst the other players (excluding, of course, the player making the purchase)

2.4 – Buy, sell or mortgage property or issue IOUs (see ##4, 5)

#3 – After the 1st round, upon passing (or landing on) ‘GO’ each player has to pay cash taxes to the gov’t (bank).

3.1 – The tax is calculated as the higher of ¼ of the per round salary receivable in the original game and 5% of the cost of houses and hotels that a player has built;

3.2 –Taxes (as well as any other payments due to the gov’t (bank) must be paid in cash (HPM or bank money) immediately; private IOUs will not be accepted;

3.3 – It is possible to sell property (property cards, houses or hotels) to the government in order to cover tax liabilities (see #5)

#4 – Cash requirements/ payments can be met as follows:

4.1 – Sale of property to other players (see #5.1);

4.2 – Sale of property to the gov’t (bank) (see #5.2);

4.3 – Taking out mortgage loans of up to ½ of the nominal value of each property card; interest is paid through a redemption premium of 20% (the bank will not accept private IOUs);

4.3.1 – The ‘Go-to-prison’ cards in the ‘chance’ and ‘community chest’ stacks are re-designated as “There is a banking crisis – the bank calls all outstanding loans at their redemption amount”

4.3.2 – Loans don’t prevent receiving income on or developing property;

4.4 – Issuance of private IOUs to other players;

4.5 – Bartering property cards with other players

#5 – Sale of property

5.1 – Private players can buy and sell or swap property at any rate that they can negotiate amongst each other;

5.1.1 – A developed property need not be stripped (unlike #5.3 below);

5.2 – The gov’t (bank) will buy any property at the higher of cost (nominal value on card + ½ cost of houses) and the rent receivable, less any outstanding mortgages at the redemption rate;

5.3 – Property sold to the gov’t (bank) is stripped down and made available for sale (see #5.3.3):

5.3.1 – Houses and/ or hotels go back to the pool (see #1.1.2);

5.3.2 – Players which land on a space available for sale may purchase it at face value

5.3.3 – If a player who has landed on a space owned by the gov’t (bank) declines to buy it, the gov’t (bank) can try to sell it through a ‘Dutch’ auction starting at face value in which all players including the player who has landed on the space can bid

#6 – The gov’t (bank) will take active measures in the following cases:

6.1 – If after 8 rounds more than 9 houses or an equivalent amount (i.e. more than 4 houses and 1 hotel; or more than 2 hotels) are left in the pool, the gov’t (bank) will reduce the tax per #3.1 by one half and purchase all the houses and hotels at the minimum price;

6.1.1 – the houses and hotels that the gov’t (bank) has acquired will be returned to the pool after one round;

6.1.2 – If an auction per #5.3.3 fails to clear at more than 25% of a property card’s face value, the gov’t (bank) shall reduce the taxes per #3.1 by one half until either (i) next auction clears above 25% or (ii) rule #6.3 (see below) applies

6.2 – If there is a banking crisis per #4.3.1 the gov’t (bank) will ‘buy’ the loans of all but the most indebted player which, hence, needn’t be called (in effect, only the most indebted player gets hit by the bank’s ‘call’ until the next chance or community card calling for a banking crisis is drawn)

6.3 – If for more than two rounds there have been no houses or hotels left in the pool and the government holds no property cards, the round tax payable upon passing ‘GO’ is doubled until the gov’t (bank) holds one or more property cards or the pool starts filling up with houses and hotels in which case the tax goes back to ‘normal’ (see #3.1) or #6.1 is applied

6.4 – Should any one player own more than 50% of all slots, the excess property over 50% of that player will be expropriated at cost (i.e. face value of property card + ½ of cost of houses/ hotels)


The game can be played in variations:

‘The Austerity Game’: if one wants to simulate a Government Budget Constraint one player must keep track of gov’t (bank) disbursements (this will be so boring in itself that your children will likely refuse to play the GBC version, as instructive as that may be – I trust that they’ll get the idea anyway…). Should aggregate disbursements at any point exceed the cumulative taxes collected by a factor of 2, the following rules should be disapplied until all taxes received throughout the game match all purchases of property from players (i.e. a ‘balanced budget’):

–   #1.2.2

–   #1.3

–   ##4.2, 5.1, and 5.3

In addition taxes per #3.1 will be doubled

‘The Austrian Game’: no gov’t (bank); just private money; in that case the following rules will be suspended:

–   ##1.2.3; 3; 4.2; 5.1, 5.3; and

–   #6

 Good luck with that…

 Observations from running test games**

– The idea is to play a game that should be fun for children while at the same time being fairly realistic and instructive

– MMM turns the classic ‘Monopoly’ game into a macro-economic game (MMters of a libertarian bent will be thrilled that at the outset all property cards and the pool belong to private individuals and all the state ‘has’ is the power of taxation and money). By matching spending and income and introducing an element of trust break-up (see #6.4), the sense of all-out dog-eat-dog competition may be mellowed or may even go away altogether

– Things to point out during or after the game:

  • Property cards stand for goods and services provided by the private sector
  • Houses and hotels represent value-add and private sector investment (note that while houses and/ or hotels are fixtures when they form part of a property and drive higher rents, houses as such are treated as inexhaustible not unlike human labour; the fact that houses and hotels can only be acquired from the other players through the pool simulates the division of labour and provides additional sources of income;
  • The pool itself is a proxy for capacity utilisation in the economy incl. employment. Given the propensity to save due to bank crisis cards (see ##4.3.1; 6.2) as a proxy for general uncertainty it can easily be shown that (i) not all money held by players will drive demand; (ii) only government spending is able to close the demand gap resulting in excess capacity; and that (iii) such gov’t (bank) spending adds to each player’s wealth. Ask the children what they think the true ‘cost’, if any, of the removing the excess capacity was.
  • The gov’t (bank) is treated as one single entity since banks perform important functions for the economy as a whole; also, it may help to explain that the nature of commercial banking should be that of a public private partnership. Also, the book keeping involved in separating gov’t and bank, as interesting as they may be to the armchair economist does slow down the game considerably – the last thing want when playing a new game with children.
  • Box with paper money (bank) is an opportunity to point out that paper money in the bank has no bearing on how the game proceeds (“if it doesn’t come out of the box it isn’t really there and when it goes into the box it’s gone…; the only way it comes out of the box and into the game is if when you take out a loan which doesn’t make you richer or if it is spent into the game by the government which does make you richer”).
    • From the point of view of making it apparent that the government doesn’t need ‘stuff’ to make money and that HPM are electronic entries, playing the game with electronic debit cards may be more intuitive (if you are attached to your old paper money game consider replacing the paper money with entries on pocket calculators for each child)
    • For a more advanced form of MMM consider using different money things for each, e.g. paper money provided in the game for HPM and mere ‘booking entries’ or entries in pocket calculators for the bank money created through loans or vice versa (there are pedagogic draw-backs to each option)

–  What MMM helps to illustrate:

  • Rather than coming out of the blue, money is created and destroyed through transactions only (endogenous money);
  • Basic macroeconomic relationships, such as spending equals income; source of profits; the relationship between investment and savings
  • Sector balances in a 2-sector economy;
  • A general sense of stocks and flows in a modern monetary economy
  • Demand is at the core of economic activity;
  • The risks in creating too much bank money (see #4.3.1) and that while it is prudent to keep a certain amount of cash in reserve (savings) lest you get snagged by the bank crisis card, doing so in aggregate slows down the game
  • The rules around banking also help to illustrate the difference between inside and outside net wealth, since the game is likely to quickly stagnate without the help of the gov’t (bank). If the only money that players use is bank money the value-add realised through building houses can only be re-distributed at the expense of other players since the money is fixed at ½ the aggregate property values. Taxes and the risk of banking crisis will put a further drag on the game. It is therefore easy to point out to the children that the only source of additional money is the gov’t (bank). This will become clear particularly if the Austrian version is played, which assumes in essence a single sector economy without any possibility for outside wealth.
  • Since MMM assumes a consolidated treasury, central bank and commercial banking sector certain complexities such as central banking operating procedures can be ignored without reducing the economic accuracy of the game;
  • Since the children start off holding property and will, most likely, raise most of their starting cash through mortgages one can easily explain that savings are not required for lending

I trust you will enjoy playing this game. Especially the first game is a real eye opener for the children since they simply cannot imagine that our little game of MMM can get off the ground without ‘money’ to start with.

Even if MMM is perhaps not the comprehensive MMT-primer for kids everyone was looking for, it is fun to play and the kids do learn a fair bit about the working of a monetary economy. 


*) – I am particularly grateful to Stephanie Kelton for pointing Alt’s article out to me.

**) I am indebted to Dr. Dirk Ehnts, my German partner in all matters MMT, who played an earlier version of the game with his students at the Berlin School of Economics and Law. Dirk has made helpful suggestions of how the game could be more fully developed for grown-ups. My sister-in-law Alexandra von Rotberg and my children, above all Jakob Hofmann, deserve to be mentioned for giving up valuable holiday time to test-run MMM.


16 responses to “Introducing Modern Money Monopoly (MMM)

  1. My variation would be to call the well known version “Bankruptcy With Friends.” As a country one or two of the four sides, call them the workers and consumers are almost out of money, and the owners and professionals have acquired most of the monopoly money. I wrote about The Penny Game here, which could have many levels added to it. It uses pennies and empty penny wrappers to distinguish between net financial assets.

  2. I like this approach as an education tool. It would seem that using the Buckaroos concept could be translated into a community currency utility. I have set out the Community Reserve Exchange (CRX) model as fully coherent with MMT. The LETS and Time Bank models are debt based, yet as a stop gap and as piece of wishful thinking they continue to implemented globally. The CRX has been dismissed as “won’t amount to much.” Yet being hung up on the didactic petards of academics and friendly investors, totally misses the point of the necessity of such educational utilities/methods by simulation/immersion What is lacking is the funds to have the CRX embodied as free ware utility via programming. Crowd sourcing might be a way. Offering it on a free basis perhaps including a hosting service. The lack of recognition of these sort of educational methodologies, basically abandons the domain to the propaganda/ideology of neo-classical. This is also apparent in the occupation of the “The Landlord’s Game” which was produced by a Quaker woman to teach Georgist (commoning) fiscal literary. In essence corporate and banking interests were allowed to erase an alternative economic model which is/was more functional than neo-classical “capital-ism.” This was also historically parallel to the occupation of academic economics curricula.

  3. While I like your practical concept of educating through games Alex, your conversion of the Monopoly game does reflect on the current reality where the far greater majority of the “money supply” is created by the “banks” – the private banks that is. I’m not sure I understand your aversion to issuing the players with “helicopter money” at the start, but you are quite content to place all the physical property and essential public services in the hands of the “players” (who in this context would represent the “people”) That of course, is a straight out “socialist” objective, but in terms of the public infrastructure and facilities, it does represent the truth because, it is the “people” who have built and paid for those things. However, if the idea is to educate children, how will you answer the question, should it be asked, “How come the people get to own all this property if they don’t have any money?”
    In addition, the emphasis on taxes is actually contrary to the fundamental principle of MMT that a government doesn’t need to collect taxes in order to spend.
    I am in total disagreement with MMT that the need to pay taxes is the reason a money supply is accepted by the society. My reasoning is contained in the following extract.

    As far as a “money supply” is concerned, it has to have two undeniable properties, it has to be generally acceptable for the buying and selling of goods or services, and the people have to be confident that the “money” they use isn’t false “money”.
    So; we are dealing with two main issues relating to the creation of any form of money supply, one, that the people must have confidence in what the money tokens represent, and two, the tokens must have some sort of guarantee they are genuine.
    It is fairly obvious that the authorities in charge of a nation, which in our modern democratic era is the Government, is the only authority in a position to provide the confidence and guarantees that the money tokens will be genuine.

    When we really analyse the fundamental purpose for having a “money system”, it comes down to having a commonly acceptable “ticket” system that allows people to buy and sell goods and services. There really is no other purpose for creating “money,” despite the myriad ways “money” is used.

    There is absolutely no point in accumulating a store of “money” – no matter what form it takes, whether it is gold or silver, pretty bits of coloured paper, or huge digital figures in a computer; if it cannot be exchanged for the essential things needed to sustain life. Paying taxes to a government will definitely not help sustain one’s life, and cannot, by any stretch of the imagination, be a justification for a Government creating a “money supply”.

    • Government’s jail and otherwise persecute those who do not pay their taxes. Avoiding that condition certainly does help sustain one’s life.

      • Yes, that’s true in the sense that one still has their “freedom”, but it does nothing in terms of long term sustainability. Taxing is really just a “power” tool to control people, and the society. If an economy, and the money supply, is properly managed, and production factors are aligned with consumption factors, inflation wouldn’t need to be controlled through taxation. Of course, this implies a rational and logical economic system, which seems to be totally beyond the intelligence quotient of politicians.

  4. I once spoke with Stephanie Kelton about developing a game that incorporated MMT principles. I never did get far, as my own graduate studies took precedence. Still, I really like the idea about using these principles in a game.

    I do not agree however that such board games should be used explicitly as teaching tools. It seems better to me to make a game that is first and foremost fun, but a game where MMT ideas are built into the game mechanics. If successfully popularized (as a fun game) with kids, then the ideas might be learned organically and incorporated into a developing worldview.

    I once mentioned in a past comment on NEP that massive multiplayer video games (e.g. World of Warcraft) offer a wonderful opportunity for the game company to explore the effects of different monetary policies. These type of games do have an in-game currency that the game company has monopolistic control. Since the amount of available in-game currency can definitely effect the in-game economy, and thus player happiness and progress, the effects of the company’s virtual monetary/fiscal policy will have real behavioral consequences.

    • Steam/Valve – the massive gaming company, hired Yannis Varoufakis, a greek economist of the MMT persuasion, as an in-game economist, to advise on and solve some of the problems they had in running their trading systems

    • I think WoW is a mixed bag when it comes to gaining understanding of the real world, or for that matter, it’s a mixed bag trying to bring real-world understanding to the game. Note that I haven’t extensively played the game since Lich King, and I’ve never actually flied in low-security space, so these claims may be a bit out of date.

      Consider first that I don’t know of any MMORPG that contains robust lending, public or private. I think some people tried it in EVE, though without bank money to back it up they really were running a “loanable funds” bank and, as I heard, it ultimately devolved into fraud anyway. (But then I assume that’s how all EVE stories end.) The lack of lending generally works out: in WoW and its clones, capital investment isn’t a prerequisite for crafting, or rather, all the capital comes baked in to the game. (That is, there are forges and anvils in Stormwind already there for public use.) EVE does have capital, but the expectation is that you pay with “ready ISK” and, if you’re trying to set up some sort of moon-mining megalith, you’ll pool the resources of several people to pull it off.

      On a positive note, all the games have a very (accidentally) MMT-ish view of money creation and destruction. In WoW, money is created when you complete a quest, loot a humanoid mob, or sell vendor trash; conversely, it’s destroyed when you repair your gear, trade on the auction house (which has a 5% tax), buy things from a vendor, train flying skills, buy taxi service, and so forth. More importantly, the former operation is done without reference to the latter, so the game allows arbitrary “public deficits.” My suspicion is that this brings the “price of money” more or less in line with the “price of time,” since WoW always allows you to spend time to get money (through, primarily, daily quests and the dungeon finder).

      But that also gets to one of its biggest weaknesses for understanding the real world: the closest thing WoW has ever had to a labor market is DKP. In the gold market, one only needs to fly out to a max-level zone and run some dailies if one’s short of money, or if for example the price of commodity ore were getting high, the N% of players with mining could devote their time to farming ore instead, so in aggregate one would expect there to always the right amount of money.

      Diablo 3 also makes an interesting example. For one thing, the game doesn’t allow a choice between farming gold and farming items, at least not in practice. But my suspicion is that the “inflation” seen in D3 comes primarily from the incredible rarity of the items that people really want, particularly compared to the number of people who want that item. Hence to a certain extent trying to get real-world insight from prices in D3 would be like arguing that a country’s economy is out of control because the local-denominated price of Michelangelo sculptures keeps going up. One would probably have to track gem prices to see if its “fiscal implementation” works out, but I never cared enough to do that myself.

      That being said, I think it would be really interesting to have an MMORPG that didn’t operate from a proto-MMT perspective, and instead, for example, tried to make an actual Austrian paradise. (For all its hemming and hawing, EVE Online is as MMT as it gets.) But much like trying to play Monopoly by Austrian rules, it would be an exercise in making an unplayable game–and while in principle it would make a nice demonstration, one can always plumb the depths of one’s paradigm to explain away any inconsistencies, i.e., the reaction would just be an example of “no true Austrian economics.”

  5. My game would probably be too complex for children, but it would certainly introduce them to the world and simultaneously traumatize them for life. Of course, adults could play with the children and help them. Let us call it “family quality time.” The game would go something like this:

    Some people should start out with lots of money already, as they have “inherited” it. With that inherited money comes the right to occassionally remind others that they should “pull themselves up by the bootstraps!” There could be supplied a deck of cards for those of inherited wealth with such taunts. I can think of a few: “why don’t you get out of the wagon and push” is an old Enron-guy standard. You could even have a caricature of Phil Gramm on the card–kind of like the little Monopoly guy. Positive cards could also be mixed in the “inherited deck” praising the wealthy and rewarding them with such entitlements as “government pays you $1 million dollars in business infrastructure aid as job creator.” Or how about: “move to NY, receive tax free status in the amount of $1 million dollars for a period of ten years as job creator.” These could be mixed in with the taunts. There could also be a “twofer” such as this one: ” government pays you $500,000 in agricultural subsidies, but if and only if you are a Congressperson and you remind poor player next to you that “food stamps are a disincentive to work.”

    The money box should start out empty, and the money should be “created” “drawn” or punched out of paper perforations with each new game by someone who refers to himself constantly as “sovereign money creator” (SCM). He will also have a rubber stamp that says “sovereign money creator” with which he stamps each bill. The rules might say that each time he refers to himself as “sovereign money creator” he must don an Uncle Sam style hat–or other symbols for other country. He can then place money in “reserves” for the banker. The money box should then be kept out of sight by the “banker” at all times–since banking is very mysterious and poor players are to be made uncomfortable trying to understand it or deal with it in any way. Players with inherited wealth are allowed to see the money box and are allowed to mumble and whisper with banker.

    If someone wants to buy a piece of property, he can make a loan from the bank, but the banker has to create a mortgage document, have the player sign it (or place his mark on it) after asking him many questions such as “what makes you think you can pay this back?” or perhaps the banker could draw a “chance” card which might say “tell him we don’t loan money on unimproved property” if indeed, the piece has no house or hotel on it. (NOTE: questions are not necessary for those having inherited wealth–or if bank draws a card that says “regulators asleep on the job” or “regulators pressured by Fed Chairman to allow derivative holiday” in which case he may make a loan to any person for purposes of derivative creation). If a loan is approved, then the banker will draw the money out of sheets of ordinary paper and give it to the person from whom the player is buying the property. A pile of money should be created by SMC for such things as “military service” (you miss three turns, during which time if another player lands on your square, you are “injured in action” and if two land on it, you are “dead”. You then have to choose another player piece, where you are now the “wife” or “husband” of the deceased; you get a big payoff for the death of your loved one, and at least you now have some money to play with in your new life. If you survive the “military” more than two or three times, you will then get a “pension”–$1200 everytime you pass goal. Maybe you could have squares that say” if you are poor (being defined as not being in possesion of certain cash or properties) and you land on this certain square, you are paid $25 for picking up garbage. If you are one of the wealthy ones, you have the option of privatizing the waste management company–and every now and then you get to charge “garbage pickpup” as a service to others. Another square for a poor person might be: “make pretend phone call to poor person next to you and remind her that her mortgage payment is past due. If she disputes that assertion, or if she asks for any information regarding her account, reply that she and her children will find themselves living in the streets unless they scrape up some made up amount of money for the bank. After five minutes, repeat call and change money amounts. Become as annoying as possible. Receive $25 for your labor from banker.

    I really get carried away, but you could have a square that says “you’ve just been pulled over by traffic cop. Poor person gets public defender and five years in jail (lose five turns) for possession of marijuana cigarette or driving without insurance–whatever. Rich person gets high priced lawyer and pays $2000 lawyer fee to other rich person. If no other rich person; pay money to banker. The possibilities are endless.

  6. Very good idea, and a good breakthrough, methinks! Just by thinking it is difficult to see exactly how well it illustrates MMT, but a good step forward by all means!

  7. Pingback: Introducing Modern Money Monopoly (MMM) | The M...

  8. I’ve used the monopoly board game metaphor to illustrate the perils of too much inequality in the system. The goal of the game is to accumulate all the wealth, effectively ending the game for everybody, including the “winner”.

  9. I agree, Glenn Bru. When I played Monopoly with my brother, he would always win, until I learned to buy every single property I landed on as the game progressed. I hated that game!

  10. How do we make these games responsive to the current tea party politically questioning which promotes the notions that, “we are running out of money,” or that “we are on the verge of becoming slaves to the Chinese, ” or that we are leaving an unsustainable debt burden to our children and their children.” Forget about turning our children into MMT economists, create a game which demonstrates that the only reason the Chinese own $1.3 trillion of US securities is because we bought at least that much stuff from them, and unless they want to buy that much stuff from us (directly or indirectly) they have nothing to do with their dollars except to buy US Government securities. Can we create games which can demonstrate that what will be critical to our children and grandchildren is not the amount of money and debt washing about in the economy which is important to their well-being, but their ability to produce the goods and services that they will desire to consume? I have no constructive game suggestions on these issues, so should probably not comment.