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
Links on Inflation
ReplyDeleteComment on ModernMoneyScot
https://twitter.com/ModernMoneyScot/status/1301077077291159553
“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
https://axecorg.blogspot.com/2019/05/settling-mmtinflation-issue-for-good.html
Dear idiots, government deficits do NOT cause inflation
https://axecorg.blogspot.com/2019/02/dear-idiots-government-deficits-do-not.html
MMT: Distribution is the drawback NOT Inflation
https://axecorg.blogspot.com/2019/02/mmt-distribution-is-drawback-not.html
Economics as tireless production of proto-scientific toilet paper: inflation theory as an example
https://axecorg.blogspot.com/2018/09/economics-as-tireless-production-of.html
How to get rid of inflation and deflation
https://axecorg.blogspot.com/2018/08/how-to-get-rid-of-inflation-and.html
MMT and the inflation-red-herring
https://axecorg.blogspot.com/2018/04/mmt-and-inflation-red-herring.html
MMT was right all along: Gov-Deficits do NOT cause inflation
https://axecorg.blogspot.com/2017/10/mmt-was-always-right-gov-deficits-do.html
How some MMTers got inflation wrong
https://axecorg.blogspot.com/2017/08/how-mmt-got-inflation-wrong.html
Inflation: back to basics
https://axecorg.blogspot.com/2017/08/inflation-back-to-basics.html
A la recherche de l'inflation perdue
https://axecorg.blogspot.com/2017/08/a-la-recherche-de-linflation-perdue.html
Forget Friedman, forget the Quantity Theory
https://axecorg.blogspot.com/2017/09/forget-friedman-forget-quantity-theory.html
Attention: there are THREE types of inflation
https://axecorg.blogspot.com/2017/06/attention-there-are-three-types-of.html
How Wicksell and the rest got inflation/deflation wrong
https://axecorg.blogspot.com/2016/05/how-wicksell-and-rest-got.html
The macroeconomic Law of Supply and Demand
https://commons.wikimedia.org/wiki/File:AXEC64.png
Egmont Kakarot-Handtke