What modern monetary theory is, and what it is not

Emilio Carnevali; Giuseppe  Fontana

doi:10.4337/ejeep.2022.0088

What modern monetary theory is, and what it is not

Emilio Carnevali, Giuseppe Fontana

Research output: Contribution to journal › Article › peer-review

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Abstract

Modern monetary theory (MMT) has grown in popularity in recent years. Several central bankers have made passing comments about it. However, the publication of two papers by Drumetz/Pfister of the Banque de France in 2021 represents the first attempt at a more systematic assessment of MMT by two scholars with knowledge of and experience in central banking. This is a welcome event in the economic debate. The present paper analyses the merits of Drumetz/Pfister’s criticism, and investigates some of the most common sources of ‘misinterpretation’ of MMT.

Original language	English
Pages (from-to)	56–66
Number of pages	11
Journal	European Journal of Economics and Economic Policies: Intervention
Volume	20
Issue number	1
Early online date	1 Oct 2022
DOIs	https://doi.org/10.4337/ejeep.2022.0088
Publication status	Published - 26 May 2023

Keywords

central banking
fiscal policy
government debt
inflation
modern monetary theory

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10.4337/ejeep.2022.0088Licence: CC BY

Carnevali-Fontana on Drumetz and Pfiser_31May2022Accepted author manuscript, 285 KB
2052-7772-article-p56Final published version, 133 KBLicence: CC BY

Cite this

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What modern monetary theory is, and what it is not

Abstract

Keywords

UN SDGs

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