Tag Archives: Monetary Monopoly Model

The Job Guarantee is the most natural implementation of the concept of having the central government act as a price setter. By making an open bid for labour at a fixed price, an effective minimum wage is created in the economy, and it will eliminate almost all involuntary unemployment. This discussion will not cover the tricky question of implementation details, but will instead discuss how this fits in with the Monetary Monopoly model.... Bond EconomicsJob Guarantee as a Policy...

What I refer to as the Monetary Monopoly Model is the simplest possible mathematical model that captures basic concepts from Modern Monetary Theory (MMT). Despite its simplicity, it gives a good feeling of how a sovereign could pin down the value of a brand new currency (relative to existing currencies, or the value of real goods or services). However, the model makes almost no assumptions about private sector behaviour, and such assumptions would be needed to simulate an existing...