Scott Fullwiler — Functional Finance and the Debt Ratio—Part V

This five part series will explore at length (warning!) and in detail (another warning—wonk alert!) the MMT perspective on the debt ratio and fiscal sustainability. While the approach suggests a macroeconomic policy mix and strategies for both fiscal and monetary policies that most neoclassical economists currently believe are unsustainable, ultimately the MMT preference for a significant role for fiscal policy in macroeconomic stabilization is shown to be consistent with traditional neoclassical views on fiscal sustainability.

This fifth and final (!) part applies functional finance to CBO’s projections of the government’s long-term budget outlook and then offers concluding remarks for the entire series.

Functional Finance, the Debt Ratio, and CBO’s Projections

New Economic Perspectives
Functional Finance and the Debt Ratio—Part V
Scott Fullwiler | James A. Leach Chair in Banking and Monetary Economics and is an Associate Professor of Economics at Wartburg College

This post has links to the four previous posts in the series.

Scott Fullwiler — Functional Finance and the Debt Ratio—Part IV

This five part series will explore at length (warning!) and in detail (another warning—wonk alert!) the MMT perspective on the debt ratio and fiscal sustainability. While the approach suggests a macroeconomic policy mix and strategies for both fiscal and monetary policies that most neoclassical economists currently believe are unsustainable, ultimately the MMT preference for a significant role for fiscal policy in macroeconomic stabilization is shown to be consistent with traditional neoclassical views on fiscal sustainability.

This fourth part integrates the content of the first three parts with the functional finance strategy for fiscal policy. Warning again—this part is the longest and most detailed of the four. 

Functional Finance and Fiscal Sustainability

New Economic Perspectives
Functional Finance and the Debt Ratio—Part IV
Scott Fullwiler | James A. Leach Chair in Banking and Monetary Economics and Associate Professor of Economics at Wartburg College

Scott Fulwiller — Functional Finance and the Debt Ratio—Part II

This five part series will explore at length (warning!) and in detail (another warning—wonk alert!) the MMT perspective on the debt ratio and fiscal sustainability. While the approach suggests a macroeconomic policy mix and strategies for both fiscal and monetary policies that most neoclassical economists currently believe are unsustainable, ultimately the MMT preference for a significant role for fiscal policy in macroeconomic stabilization is shown to be consistent with traditional neoclassical views on fiscal sustainability.

This second part discusses interest rates on the national debt in the context of a currency issuer operating under flexible exchange rates.

Interest Rates and Flexible Exchange Rates

New Economic Perspectives
Functional Finance and the Debt Ratio—Part II
Scott Fulwiller | James A. Leach Chair in Banking and Monetary Economics and Associate Professor of Economics at Wartburg College

Scott Fulwiller — Functional Finance and the Debt Ratio—Part I

This five part series will explore at length (warning!) and in detail (another warning—wonk alert!) the MMT perspective on the debt ratio and fiscal sustainability. While the approach suggests a macroeconomic policy mix and strategies for both fiscal and monetary policies that most neoclassical economists currently believe are unsustainable, ultimately the MMT preference for a significant role for fiscal policy in macroeconomic stabilization is shown to be consistent with traditional neoclassical views on fiscal sustainability.

This first part defines the correct measure of the national debt and then looks at the mathematics of debt service and the debt ratio.

New Economic Perspectives
Functional Finance and the Debt Ratio—Part I
Scott Fulwiller | James A. Leach Chair in Banking and Monetary Economics and an Associate Professor of Economics at Wartburg College