Expiring money basically incentivizes short term thinking over long term goals. Businesses won't save for improvements, retirement won't exist, etc.
If you receive a dollar and pay tax on it due to the work you undertook to receive it, it gets 'refreshed' and increases in value.
If you get a 'stale dollar' (e.g. gifted from a parent) it depreciates until you use it constructively.
If you're an advocate of "trickle-down" economics, you should be lapping this us, as it's rewarding people for what you believe already happens.
Of course a much simpler approach would be to simply flip the outrageously stupid system most of us have, where income from passive investments is taxed at a lower rate than income from providing work.
For example if this “stamped money” expired at the end of the year, everyone is required to accept it until then, and for six months afterward it can be redeemed at a bank for fifty cents on the dollar... then instead of people refusing to take it you’d have a big flurry of holiday shopping but increasing prices for stamped money at the end as its value neared the drop off. You would also have some people probably try to gamble on acquiring a lot of that money at a discount before its expiration thinking they could flip it in time or acquire it for less than its redemption value from people who just wanted to unload it.
It’s an interesting thought experiment.
But I think in today’s world of mostly electronic money, something like this would be much harder to pull off. It would presumably only apply to cash - since the entire banking system would have to revise itself to track expiring dollars separately - and I think rather than seeing a lot of adoption you’d be more likely to see many businesses suddenly stop accepting cash entirely.
I'm unsure how you get around folks who will launder this money into assets to counter the inflationary mechanism, unless you're means testing in some capacity, or you just don't care about the cohort who does this (which is a reasonable approach imho).
Most of the time, people with large amounts of cash are workers (skilled construction workers...) that are able to get a significant part of their income in cash and do income tax avoidance. Or criminals (drug dealers...).
Having to deposit their hidden savings all-at-once is not good news for them. This is basically what happened when France switched to the Euro.
If they have to explain where the money came from, they can just say “it is the cash I withdrew a few months ago, here is the transaction number”
Also, since when did "saving" become "hoarding"? Saving is a very important part personal financial wellness and business investment. Our goal should not be incentivizing people to spend money as quickly as they make it.
I think wise societal goals would be those that clearly and consistently lead to increased funds for people in non-upper classes.
The systemic vaulting of fungibles (in the amount of scores of multiples beyond reasonable needs) may result in the same outcomes as hoarding does.
But whether or not anyone notices, the math is simple: it will be very bad for lower income levels. If you have 1% depreciation over a year, and you are spending 90% of your money on day to day expenses, the relative loss in margin of survival is far worse than if you are spending 20% on day to day expenses.
But I will say, in many ways we have the opposite problem right now. Too much money chasing too few good opportunities for a return has led to things like SoftBank, WeWork and many others.
