Monetary Theory

Per Bylund joins Bob to discuss his new paper at the QJAE, which points out several flaws in the MMT claim that money is valued in order to pay taxes.

Can the injection of new money into the economic system enhance economic growth? Not really. Increasing (or decreasing) the money supply affects the demand for money but doesn't make us wealthier.

Monetarists believe there is an optimum growth rate of money. However, a fiat money system itself is unstable, so there is no optimum growth rate.

Can the injection of new money into the economic system enhance economic growth? Not really. Increasing (or decreasing) the money supply affects the demand for money but doesn't make us wealthier.

Monetarists believe there is an optimum growth rate of money. However, a fiat money system itself is unstable, so there is no optimum growth rate.

Money proper is not artifice. It is a physical "thing" of value, acquired through labor and emerging out of the needs of individuals, who through voluntary exchanges determine its value.

Money proper is not artifice. It is a physical "thing" of value, acquired through labor and emerging out of the needs of individuals, who through voluntary exchanges determine its value.

Keynesians and fellow travelers hold the Phillips curve to be sacrosanct. But because the Phillips curve cannot establish causality, it is useless as economic theory.

Resources are scarce even when money is not.

Resources are scarce even when money is not.