Wednesday, November 9, 2016

Bill Mitchell — Hyman Minsky was not a guiding light for MMT

I am currently working on a book commissioned by Edward Elgar which will form an anthology of influential Modern Monetary Theory (MMT) literature – how it evolved – with a long introduction by me tying all this literature together. It has been a simmering project for the last 18 months and I haven’t mentioned it here until now. The first task was to assemble the literature and then the next task was that the publisher (EE) has to get copyright clearance from the original holders. The second process has taken some time and I have had to alter the proposed table of contents because we cannot get copyright clearance. The reason I mention this is that the work of Hyman Minsky is not among the literature I have selected as being influential in the intellectual development of MMT. That is not to say that some of his earlier work was of no interest. Quite the contrary. But when he makes statements that appear to be consistent with MMT propositions, he is, in my view, just channelling the likes of Abba Lerner and his functional finance. But later in his career, Minsky started to articulate ideas that were consistent with ‘sound finance’, which Lerner had opposed, and, which is anathema to MMT.…
Bill Mitchell – billy blog
Hyman Minsky was not a guiding light for MMT
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

5 comments:

Calgacus said...

Trouble in MMT paradise?

I doubt the USAns will agree too much. Mitchell has some good quotes that show Minsky leaned a bit more to sound finance than I thought. But on the other hand Lerner himself, who IMHO got it just right, leaned just a bit more toward sound finance than Mitchell's version of Lerner, I would say. :-). For all Mitchell's many virtues, I still say that the USAns are somewhat better and more objective and detached historians and philosophers of money.

Matt Franko said...

You could shit can him right at "stability creates instability "...

Ignacio said...

Some Dan used to say say it in this blog, that Minsky was a closet conservative.

Matt Franko said...

"Philosophers of money"

Calg that is an oxymoron...

Matt Franko said...

"So it is a common ploy by ‘deficit doves’ who think deficits are fine as long as you wind them back over the cycle (and offset them with surpluses to average out to zero) "

Maybe their biases towards "equality!" is so pathological that they apply it also in this case too??

"The apex creates the nadir!" = "stability creates instability!" = "the deficit creates the surplus!!"