Thursday, September 5, 2019

A conversation with Eric Tymoigne on MMT vs SMT — David Andolfatto

At least one mainstream economist is engaging with MMT. Eric Tymoigne is his go-to guy on MMT. They have kindly let us in on their conversation.

A conversation with A conversation with Eric Tymoigne on MMT vs SMT
David Andolfatto on MMT vs SMT
David Andolfatto | Vice President, Federal Reserve Bank of St. Louis


Andrew Anderson said...

ET: Yes, ability to create a currency does not mean ability to command resources because there may not be a demand for the currency. That is where tax liabilities and other dues owed to the government become important (cf. the chartalist theory of money, a component of MMT). That’s also why taxes, monetary creation and bond issuance are not conceptualized by MMT as alternative financing means but rather as complementary. [bold added]

Then why support privileges* for banks which increase demand for bank deposits by decreasing demand for fiat?

*Privileges such as exclusive access to inherently risk-free accounts at the Central Bank.

Ralph Musgrave said...

I left a comment after the Andolfatto article.