by Yves Smith: I think Modern Monetary Theory proponents have made acceptance of their ideas a bit more difficult by not drawing a bright line between their theory, which is a description of how government spending works in a fiat currency system, versus what they believe are resulting sound policy approaches, such as setting the price of labor (a Job Guarantee) rather than the price of money. Some folks seem slow on the uptake. How loud to MMT economists need to shout? (shakes head) Why is the MMT position that MMT economists shares and have written about exhaustively so difficult to grok? I suspect it is because MMT uses a different lens for looking at macroeconomics and political economy, while others continue to look through their own accustomed lenses.Hello, MMT is not
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Mike Norman considers the following as important: MMT, Political Economy, tax justice, tax policy
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I think Modern Monetary Theory proponents have made acceptance of their ideas a bit more difficult by not drawing a bright line between their theory, which is a description of how government spending works in a fiat currency system, versus what they believe are resulting sound policy approaches, such as setting the price of labor (a Job Guarantee) rather than the price of money.Some folks seem slow on the uptake. How loud to MMT economists need to shout? (shakes head)
Hello, MMT is not essentially about tax justice. That is a different subject that informs political economy and it is chiefly a political matter, as implied by the term, "justice." "Justice" is a legal term, not an economic one.
Political economy intersects with philosophy, sociology, evolutionary theory, anthropology, sociology, political theory, law and justice, etc. The MMT economists are doing macroeconomics, which is their field of expertise. Because MMT is a type of institutional economics that also builds on Post Keynesianism and other influences, it is difficult for other economists to categorize so they try to force it into a box that doesn't fit.
When MMT economists venture into policy, they do so personally. Macroeconomic is policy-neutral other than in its assumptions. But the commonly held assumption among macroeconomists is that the chief aim of macroeconomics is explaining the relationship of growth, employment and price. MMT offers a unique approach to this using a different lens to look at the data and issues and to construct models of different types of systems.