Tag Archives: MMT

Richard Murphy comments on Peter Bofinger's article, linked to here at MNE yesterday. Progressives and others on the so-called left need to read and understand this. The right won't pay any attention to it since it is Keynesian.Tax Research UKWhy the fantasy world of neoclassical economics is undermining our wellbeingRichard Murphy | Professor of Practice in International Political Economy at City University, London; Director of Tax Research UK; non-executive director of Cambridge...

Saving, like taxation, is demand leakage. If most of a fiscal stimulus package leaks to saving, then the effect is minimal because the multiplier is too low to make a significant difference. The danger here is concluding that fiscal stimulus therefore is ineffective.  On February 7, 2020, the Reserve Bank of Australia’s Governor, Philip Lowe appeared before the Federal House of Representatives Standing Committee on Economics to discuss the – Reserve Bank of Australia Annual Report 2019 –...

Politicians often tell us that we should live within our means. Quite right. Unfortunately, many of them do not appear to understand what this actually entails when it comes to fiscal policy. So far as most economists are concerned, the events of the last decade have thoroughly discredited advocates of austerity. Yet, it remains quite common to hear politicians from across the political spectrum calling for reductions in fiscal deficits or even fiscal surpluses. There appears to be little...

I have two days of teaching left in Helsinki and my next stop on Friday is Dublin where I will be discussing unification and exit. Should be a fun topic. Its Wednesday back home already and today I consider a matter that came up in one of my classes that I am taking in macroeconomics at the moment at the University of Helsinki. Students really struggle when first introduced to the idea of a stock and a flow. They can easily be led into defining a flow as a stock. Getting this absolutely...

“Fiscally responsible” is one of the more Orwellian phrases in American politics. Lawmakers earn that coveted title by affirming the three tenets of the Beltway’s official budgetary orthodoxy: (1) Deficits are inherently undesirable, (2) all new spending (on things that cannot be used to kill foreigners) should be fully offset by new taxes, and (3) reducing America’s existing national debt should be a top-tier policy priority. But these premises are rooted less in economic science than...

Most critiques of MMT take the form of a critic asserting "MMT says X." The response from MMT proponents is that MMT most definitely does not say "X". This situation is obviously confusing. This article attempts to explain why the online debates are confusing (and pointless).... Bond Economics Functional Finance Roots Of MMTBrian Romanchuk

States with a currency of their own can never run out of money. That's a core thesis of the Modern Monetary Theory which spilled over to Europe from the US. German economist Dirk Ehnts elaborates on what it's all about.... DW (Deutsche Welle)Modern Monetary Theory: Cash-strapped governments a thing of the past? Hardy Graupner interviews Dirk Ehnts, research assistant at the Chair of European Economics at the Technical University of Chemnitz

Good summary of MMT featuring the distinction between currency users and the issuer of the currency.  Short read.The ConversationBernie Sanders' economic adviser has a message for Australia we might just need Steven Hail | Lecturer in Economics, University of Adelaide

So just a brief comment on the latest fiasco from ‘Mr Spreadsheet’ Kenneth Rogoff as he stares into the abyss of irrelevance and is trying to hand on like grim death to any shred of credibility. He has none. If he ever did, the spreadsheet scandal finished it. But he never did anyway.... Bill Mitchell – billy blogThe old guard trying to stay relevant and failingBill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of...

Most public debate around Modern Monetary Theory (MMT) revolves around fiscal policy. This is not too surprising, as this is largely where political economy concerns crop up when discussing MMT. However, the emphasis on fiscal policy makes discussions of the MMT debates quite awkward. There is a large divide between the debate in modern economic theory, and the debate in popular discourse. If we look at economic theory, there are no credible challenges to the MMT story at present; at most,...