Sunday, August 30, 2020

Primer: MMT Theory Of Inflation — Brian Romanchuk

The Monetary Monopoly Model (Section 4.3) is a core model of Modern Monetary Theory. If we take it literally, we do not need a theory of inflation, since the price level in some variants of the model is explicitly set as a policy variable. However, reality is far more complex than the model suggests, and if we want to match theory to reality, we are faced with the realisation that governments act in a fashion that sabotages the control of the price level that they do have.
(Note: This is an unedited draft of a section of my increasingly long MMT primer.)
Bond Economics
Primer: MMT Theory Of Inflation
Brian Romanchuk

1 comment:

AXEC / E.K-H said...

Links on Inflation
Comment on ModernMoneyScot

“There is a third, and perhaps most important reason why we will also not get inflation. That is because of the nature of modern money.”

Not really, the fact is that monetary theory, including MMT, is proto-scientific garbage. More details

Settling the MMT―Inflation issue for good

Dear idiots, government deficits do NOT cause inflation

MMT: Distribution is the drawback NOT Inflation

Economics as tireless production of proto-scientific toilet paper: inflation theory as an example

How to get rid of inflation and deflation

MMT and the inflation-red-herring

MMT was right all along: Gov-Deficits do NOT cause inflation

How some MMTers got inflation wrong

Inflation: back to basics

A la recherche de l'inflation perdue

Forget Friedman, forget the Quantity Theory

Attention: there are THREE types of inflation

How Wicksell and the rest got inflation/deflation wrong

The macroeconomic Law of Supply and Demand

Egmont Kakarot-Handtke