Quantitative Easing: A Keynesian Critique

Thomas Palley

Working Papers from Political Economy Research Institute, University of Massachusetts at Amherst

Abstract: Keynesian economists have generally supported quantitative easing (QE) on grounds it increases aggregate demand and anything that increases demand at this time of demand shortage is welcome. This paper argues that response may be misplaced. QE may back fire with respect to demand stimulus, create potentially significant future dangers, and is supportive of a plutocratic political economy based on “asset market trickle-down” that obstructs needed policy change.

Keywords: quantitative easing; monetary policy; asset prices (search for similar items in EconPapers)
JEL-codes: E43 E44 E50 E52 E58 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (9)

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