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Friday, April 12, 2013

Nominal GDP Targeting: New-Fangled Monetarism or Old-Fashioned Keynesianism

Mises Daily: Friday, April 12, 2013 by Shawn Ritenour
In the wake of the financial panic and economic recession of 2008, numerous macroeconomic policies are being re-evaluated. Some economists argue that the crisis demonstrates a need to move away from Ben Bernanke-type discretionary monetary policy and instead adopt some monetary policy rule. One such proposed rule is nominal GDP (NGDP) targeting, made popular by a set of economists that have been given the moniker “market monetarists.”
Market monetarism is largely a blogosphere phenomenon, with the most prominent blogs amongst the group being Scott Sumner’s The Money Illusion, Lars Christensen’s The Market Monetarist, and David Beckworth’s Macro and other Market Musings. The most well-known of the group, Scott Sumner (2012; 2011), has authored two scholarly works that outline his vision for monetary policy, and Christensen (2011) has authored a working paper summarizing the work of the group. …To Read More…..

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