MMT: Modern Monetary Theory or Magical Monetary Thinking? The Empirical Evidence

Emilio Ocampo ()

No 762, CEMA Working Papers: Serie Documentos de Trabajo. from Universidad del CEMA

Abstract: This article presents a summary of the main theoretical arguments and policy recommendations of Modern Monetary Theory (MMT) and traces back its intellectual origins to the writings on money of Georg F. Knapp and on fiscal policy of Abba P. Lerner. It also presents evidence on two countries that followed MMT like policies: Germany between 1939 and 1945 and Argentina with brief interruptions since 1946. The main conclusion of the article is that any country that consistently follows the policy prescriptions of MMT will inevitably experience high inflation and lower (and even negative) economic growth.

Keywords: Monetary Theory; MMT; Argentina (search for similar items in EconPapers)
JEL-codes: B00 N14 N16 P40 P47 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2020-11
New Economics Papers: this item is included in nep-cba and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:cem:doctra:762

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