Lars P. Syll

 [embedded content] If thou hast shown mercy unto man, o man, that same mercy shall be shown thee there; and if on an orphan thou hast shown compassion, that same shall there deliver thee from want. If in this life the naked thou hast clothed, the same shall give thee shelter there, and sing the psalm: Alleluia.

New MMT macroeconomics textbook This book presents a comprehensive, university level study course in Macroeconomics from a Modern Monetary Theory (MMT) perspective. Our approach is grounded in the operations of real-world institutions, and our approach clearly identifies the policymaking capacity of central governments. The pedagogy thus starts by putting the currency-issuing government​ at the forefront. We want students to understand how a modern monetary...

Labor’s share — the ‘stylized fact’ that isn’t a fact at all According to one of the most widely used textbooks on mainstream theories of economic growth, one can for the United States “calculate labor’s share of GDP by looking at wage and salary payments and compensation for the self-employed as a share of GDP. These calculations reveal that the labor share has been relatively constant over time, at a value of around 0.7.” But is this “classic stylized...

How to get published in top economics journals … The reality is that the mainstream follow a formulaic approach to publications in macroeconomics that goes something like this: Assert without foundation – so-called micro-foundations – rationality, maximisation, rational expectations – imposed assumptions about human behaviour that no sociologist or psychologist would remotely recognise. These foundations cannot deal with real world people so assume there is...

Der Himmel über Berlin  [embedded content]

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Can a Central Bank ever run out of money?  [embedded content] (h/t: Stephanie Kelton)

Mainstream nonsense about budget deficits The standard mainstream textbook argument about budget deficits goes something like this: Assume that total output is given. If government expenditures are increased, then this has to be met by an equally large decrease in investment, which can only come forth by rising interest rates. ‘Crowding out’ reduces public saving and causes interest rates to rise. Then, applying the logic of the Solow growth model, it is...

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Is MMT nothing but Knapp + Lerner + Minsky + Vertical IS curve? Turning to Brad’s challenge, some of the answers will now be obvious. Do we accept the elements he lists as fundamental to MMT? Knapp: yes indeed. He’s always been there … Lerner: dealt with above. What we reject is the aggregate demand approach to full employment and price (and financial) stability. As Minsky argued in the 1960s, pump-priming might get you to full employment but it will never...