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Language: English ｜ Sequential Provenance Comparison（SPC）｜公開ページ
Published: September 9, 2026
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Balanced accounts do not guarantee an executable society.
What SPC seeks to bring to wider attention is the Copernican turn that Bernard Schmitt introduced into our understanding of money and economic processes. Money is understood not as a deposit balance, but as a flow issued at the instant of payment and extinguished within that payment. Wage payment simultaneously forms income and product price, after which that income enters into exchange with the product. The basis of observation shifts from balances to payment, formation, and exchange.
Sequential Provenance Comparison (SPC) does not merely repeat this turn within Schmittian theory. It tests the differences disclosed by that viewpoint from outside the theory, as questions of constructibility under ordinary accounting and identification through provenance. By combining the formal semantics of programming languages, double-entry bookkeeping, and provenance analysis, SPC makes hidden path differences, disruptions between income and objects of exchange, and distinct formation processes leading to the same endpoint independently traceable and reproducible.
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What’s New｜October 4, 2026
An accounting-consistent policy path need not be institutionally executable
Can Accounting-Consistent Reduction Support Policy Inference? | Public Paper Page
Can Accounting-Consistent Reduction Support Policy Inference? Preserving Institutional Feasibility in SFC Models: A Minimal Counterexample
会計整合的な縮約は政策推論を支えられるか――SFCモデルにおける制度的実行可能性の保存と最小反例
The subject is not merely the fact that deposit use can be restricted. Maintaining numerical accounting and preserving the admissibility and updates of operations required by policy-effect calculations are separate verification requirements. The paper asks whether reduction—summarizing detailed states through aggregation or consolidation—discards conditions needed for the model’s own policy path to occur.
Central results
Two loans of 20 from a common initial state produce identical aggregate deposits, borrowing, and numerical formation flows, yet different use conditions permit the same next payment in one state and prohibit it in the other. Even a reduction reproducing current admissibility exactly can lose information governing review or release, causing subsequent paths to diverge. Deposits provide a minimal witness to the absence of a general guarantee from accounting consistency to institutional feasibility.
An independent, closed one-period model fixes desired purchases, supply, and settlement conditions and yields realized expenditure of 20 or zero after quantitatively equal credit formation. Treating total deposits as usable funds overpredicts expenditure by 20 under the restricted contract. If eligibility is unknown, this specification identifies a range of zero to 20; a point prediction of 20 requires an additional assumption.
Why this paper matters for the research programme
Scope of the claim
The paper does not reject SFC accounting principles: SFC can retain heterogeneity and institutional attributes. Its BMW application audits an added institution, not an error within the original model’s scope. Prices are fixed; neither inflation-rate effects nor errors in actual policy evaluations are established. The proposal is to audit the admissibility and updates of policy-path operations independently of numerical accounting.
Version: 1.0 ｜ Status: Working Paper / pre-peer-review preprint
Materials: English version (15 pages) and Japanese version (13 pages)
Zenodo: public record ｜ DOI: 10.5281/zenodo.23127811
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Previous Highlight｜September 26, 2026
The mainstream equation “profit = sales revenue − production cost” is inadequate as a macroeconomic state description Informational Superiority of Schmittian Notation | Public Paper Page
Informational Superiority of Schmittian Notation as a Macroeconomic State Description: Comparing the Departmental Status and Logical Order of Profit through SPC マクロ状態記述としてのSchmitt派記法の情報的優位性――SPCによる利潤の部門資格と論理的順序の比較
The paper connects Carrera’s numerical example 100–80–20 with the Schmittian three-department bookkeeping presented by Cencini and Bradley. It compares State 1, in which formed profit of 20 is recorded in Department II, with State 2, in which that profit has been transferred to Department III. The two states have identical aggregate totals for deposits, claims on firms, profit, goods, and the consolidated external net balance, while transfer completion differs.
Central result The mainstream equation “profit = sales revenue − production cost” can calculate profit as a residual, but it does not represent the operation through which final expenditure recovers costs and forms profit, or the departmental status acquired afterward. It therefore cannot distinguish the two states or determine whether the required transfer has been completed. Schmittian notation preserves the departmental status of profit and can identify the difference. The claim is not that Schmittian notation is universally superior, but that the mainstream equation is informationally insufficient for this specific macroeconomic audit.
Why this paper matters for the series
Version: 1.0 ｜ Status: Working Paper / pre-peer-review preprint Materials: Japanese edition (12 pages) and English edition (13 pages) Zenodo: public record ｜ DOI: 10.5281/zenodo.22983561
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Previous Highlight｜September 24, 2026
Working Paper Version 1.3 is now available Why Schmitt’s Argument Deserves Serious Examination | Public Paper Page
Why Schmitt’s Argument Deserves Serious Examination: A Disrupted Exchange Relation in Ordinary Accounting シュミットの議論を真剣に検討すべき理由――通常会計に現れる交換関係の断絶
The purpose of this paper is to take Schmitt’s Copernican turn beyond the confines of a closed doctrinal system and present it as a question that anyone can examine.
The paper asks whether wages and firm-acquired capital goods can both be recorded as 20, with every journal entry balanced, while no preserved consumption-goods inventory is saleable to the worker at the focal point. This question becomes visible when the unit of observation shifts, as Schmitt proposed, from balances to payment, formation, and exchange.
The paper does not assume in advance that Schmitt’s theory of capital malformation is correct. It extracts a testable construction prediction from the theory, builds an existence witness using ordinary bank and firm accounting, distinguishes that path from alternatives through SPC, and only then compares the result with the Schmittian explanation. The Copernican turn is therefore presented not as a celebratory metaphor, but as a research procedure that predicts, constructs, and compares differences that older representations can record yet leave obscure.
Central existence result In Path A, focal wages of 20 are paid, capital goods with a production cost of 20 are produced by that labour, and the firm acquires them. The bank and firm balance sheets remain consistent throughout. Yet immediately after the focal event, saleable preserved consumption-goods inventory for the worker is zero. The product exists, but it becomes the firm’s capital good rather than an object offered in exchange to the income holder. Path A is therefore an existence witness showing that accounting consistency does not by itself establish the corresponding exchange relation.
Four-path comparison in Version 1.3
Under $\Omega_0$, which retains only wages, firm-acquired capital goods, and the direct acquirer, all four paths appear identical. Adding saleable consumption-goods inventory $C_H$ separates A/C from B/D. Adding new firm debt $D_W$ transactionally linked to the focal wages distinguishes the paper’s finite set of four paths. B and D even begin from a shared prehistory and return to the same endpoint balance sheet while retaining different financing provenance for the focal wages.
Why the result matters The issue is not an erroneous journal entry. It concerns how individually valid entries are connected through order and provenance, and how those connections form the relations among income, objects of exchange, and capital-goods acquisition. If a theory or statistical representation omits exchange relations and formation provenance, it must explain why that abstraction is warranted for its explanatory purpose.
Boundary with theory Ordinary accounting establishes constructibility and path identification, not Schmittian classification. Accounting production cost 20 is not treated as Schmittian price 20, and an accounting sales margin is not treated as monetary profit. Comparison with capital malformation and malignant inflation begins only after the complete path and further conditions—including compensation by preserved goods, the depreciation-recognition and replacement sequence, and ultimate economic attribution $O=NP$—have been made explicit. Empirical frequency and consequences for prices, employment, accumulation, and distribution remain subsequent research questions.
Version: 1.3 ｜ Status: Working Paper / pre-peer-review preprint Materials: Japanese paper (23 pages), English paper (27 pages), and Japanese/English replication workbooks Zenodo: public record ｜ DOI: 10.5281/zenodo.22926504
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SPC’s problem setting began from the effort to understand Bernard Schmitt’s theory of “capital malformation.” Yet reproducing the expected conclusion in bookkeeping form while presupposing Schmitt’s distinctive concepts of money, income, and profit would not test the mechanism from outside the theory. SPC was therefore developed to construct multiple feasible paths first under ordinary bank and firm accounting, and then audit which observational information is required to distinguish them.
Independence here does not mean that the objects of investigation were discovered in a theory-neutral way. The decision to examine saleable consumption goods, new credit linked to the focal wage payment, and a depreciation-recognition and replacement sequence is guided by Schmittian theory. What is tested independently is whether the candidate paths are feasible under ordinary accounting and distinguishable under specified observation maps. Those checks do not use Schmitt-specific definitions of money emission, monetary profit, empty wages, or capital malformation.
The order of argument is theory-guided construction prediction → existence test under ordinary accounting → provenance identification using SPC → conditional comparison with Schmittian monetary theory. The Version 1.3 revision released on September 24, 2026 places at the centre of the argument an existence result: ordinary-accounting feasibility is compatible with the absence of saleable consumption-goods inventory at the focal point. It also constructs four paths combining the presence or absence of preserved consumption goods and new credit, while distinguishing value correspondence at formation, exchange with the income holder, financing provenance, and ultimate economic attribution.
It was also subsequently recognised that the method could be applied to Modern Monetary Theory (MMT) to test the ordering and institutional feasibility of government spending, taxation, and bond settlement, and the results were developed into a paper on the formal specification verification of settlement protocols.
SPC Version 1.0 extends and formalises the method beyond its application to individual theories, establishing it as a general formal framework for verifying multiple economic institutions.
Released on October 4, 2026, Can Accounting-Consistent Reduction Support Policy Inference? | Public Paper Page advances this concern to SFC state reduction and policy inference. Preserving accounting consistency does not guarantee a policy path if the reduction fails to preserve target-operation admissibility and updates. SPC connects discarded attributes and missing update rules to reachable counterexamples and model repairs.
SPC combines the formal semantics of programming languages, double-entry bookkeeping, and provenance analysis to test an economy as an institutional protocol with explicit conditions of execution.
Balanced terminal accounts do not guarantee that the transactions leading to them can actually be performed. SPC makes means of settlement, real resources, institutional powers, and transaction order explicit, representing structures that halt during execution as “social bugs.”