JKH commented on a recent post of Pavlina Tcherneva at New Economic Perpsectives. Lots of good comments there from John Carney, Pavlina, JKH, and may regulars here, too.
(h/t Senexx via Twitter)
Further to our previous discussion, let me present a shocking recommendation for how to market MMT:
Define Modern Monetarism as that school of economics and economists whose primary public policy objective is full employment and price stability, using MMT as the analytical engine behind policy development.
Redefine MMT as the descriptive, analytical component of MMT as we identity it now.
That positions Modern Monetarism as a very strongly policy oriented economics movement, and MMT as the unique analytical approach it uses.
So the primary marketing presence of Modern Monetarism and Modern Monetarists would be their goal of achieving a set of specific public policy objectives that include JG at the top of the list (I presume).
Within that policy set, you could work out what I’ve referred to as the optionality range covering that policy set (e.g. zero rates), but making it clear that achieving JG is the leading policy thrust of modern monetarism (or not, depending on how you choose to define your policy set objective).
In thinking about this, I’ve reflected on the comparison of the MMT situation with the relatively new “Market Monetarists”. The irony here is that the Market Monetarists have a stronger marketing strategy than MMT, at least in my view, but a much weaker analytical engine behind it, again in my view. The reason I say that is that their policy objective is rather clear and “out there” – NGDP targeting. My impression that their analytical engine is much weaker, while personal, is probably something that MMTers would be quite sympathetic to. It has to do with the nature of the monetary policy actions they envisage as accomplishing their objective, should such an objective ever be adopted as policy. Enough said about that. But the curious thing about their situation is that the policy thrust of NGDP targeting gets the buzz from a marketing perspective, and the underlying analytical engine doesn’t get all that much attention, relatively speaking. The effectiveness of that engine is just assumed away. It’s like drive for show, putt for dough in golf – the drive there is NGDP targeting, but personally I don’t think they’ll ever get the ball in the hole. This is something Modern Monetarism may want to think about – driving for show with even more emphasis on the policy side than exists now. As far as getting the ball in the hole goes, I’m probably more convinced at the outset that the Market Monetarists, once on the green, would end up putting the ball right off the green and into the bunker. I’m not sure about the comparable case of the Modern Monetarists, except that I think they’re definitely much better at reading greens, which is a good start.
(Bonus corollary to the recommendation – Cullen Roche gets to advertize unambiguously that he still loves MMT)source