Thursday, December 7, 2023
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Bond Economics: CEA MMT Panel Publish-Mortem

I participated in a “Yay/boo for MMT!” debate Zoom panel for the annual Canadian Economist Affiliation convention. I don’t suppose I stated something outrageously silly or bought anybody raging mad at me, so I beat my expectations going into it.

(I have no idea if these panels will probably be publicly out there after the tip of the convention.)

The “con” facet of the panel primarily focussed on a query: “Does MMT add new coverage instruments?” Since we didn’t go too far in discussing the Job Assure (or issues like incomes coverage, this was probably not nice for MMT — since we’re caught with two excessive stage coverage levers — fiscal and financial coverage. Clearly, having each fiscal and financial coverage creates extra freedom of motion than simply fiscal coverage (if we take the exhausting line anti-monetary coverage stance of some MMT proponents).

The one technique to profitably tackle that line of argument in a hypothetical repeat of this debate is to have considerably detailed plans on reform fiscal policymaking in Canada. Nonetheless, that’s not only a “generic MMT” matter, it’s a matter in Canadian institutional framework evaluation — which I’m not the particular person to ask about.

I attempted to steer the dialogue in the direction of idea, however the different facet of the panel was not — they’re primarily concerned about coverage evaluation.

One take away is that the dialogue confirmed my perception that “downgrading financial coverage” goes to be an especially exhausting political battle. One would wish to persuade lots of people that financial coverage is ineffective — and that could be a very thorny analytical drawback. (Why is it thorny? Neoclassical beliefs about rate of interest coverage seem like non-falsifiable. Good luck with falsifying a non-falsifiable perception!)

What I’d supply as a generic lesson for this train is that discussing “MMT” as an idea is a useless finish, one must concentrate on specific concrete matters of curiosity, and see whether or not MMT is providing helpful insights into that matter.

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(c) Brian Romanchuk 2023

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