The monetary and fiscal nexus of neo-chartalism: A friendly critique

Abstract : A number of post-Keynesian authors, called the neo-chartalists, have argued that the government does not face a budget constraint similar to that of households and that government with sovereign currencies run no risk of default, even with high debt-to-GDP ratio. This stands in contrast to countries in the eurozone, where the central bank does not normally purchase sovereign debt. While these claims now seem to be accepted by some economists, neo-chartalists have also made a number of controversial claims, including that the government spends simply by crediting a private-sector-bank account at the central bank; that the government does need to borrow to deficit-spend; and that taxes do not finance government expenditures. This paper shows that these surprising statements do have some logic, once one assumes the consolidation of the government sector and the central bank into a unique entity, the state. The paper further argues, however, that these paradoxical claims end up being counter-productive since consolidation is counter-factual.
Type de document :
Article dans une revue
Journal of Economic Issues, Newfound Press, 2013, 47 (1), pp.1-32. 〈10.2753/JEI0021-3624470101〉
Liste complète des métadonnées

https://hal-univ-paris13.archives-ouvertes.fr/hal-01343744
Contributeur : Pascal Seppecher <>
Soumis le : samedi 9 juillet 2016 - 15:38:30
Dernière modification le : jeudi 11 janvier 2018 - 06:23:32

Identifiants

Citation

Marc Lavoie. The monetary and fiscal nexus of neo-chartalism: A friendly critique. Journal of Economic Issues, Newfound Press, 2013, 47 (1), pp.1-32. 〈10.2753/JEI0021-3624470101〉. 〈hal-01343744〉

Partager

Métriques

Consultations de la notice

714