Monetary
freedom derived from concepts
of monetary economics and monetarism. The first is a discipline that permits to
analyse money as a medium of exchange, a valuable unit and a cost unit. The
second one is the control of the government on current money. The monetary
freedom level of a country can be measured b : the price stability (inflation)
and the price control.

–      
Inflation:
is monetary phenomenon, an increase in the general price level for buying goods
and service. It can happen within a certain period of time. Its effect is a
loss of money value. Basically, it means ”too much money chasing too few
goods.”

–      
Price
control: is when the government decides to limit prices of goods in the market.

Monetary freedom is a combination of these two measures.

Monetary
freedom is the condition in which there is price stability but no interference
from government.

Inflation
and price control may lead to significant consequences and distortion of market
activity.

In order to
have monetary freedom, government’s function should be to safeguard property
rights, maintain price stability, fight inflation so that markets can expand.