marc lavoie

Post-Keynesians And Others

3 September 2012

That is the title of Chapter 1 (by John E. King) of this book which has just come out. The Routledge website is here. I just got the book and flipped through to come across this at the beginning of Frederic Lee’s article (Chapter 6): HETERODOX CRITIC: We want to change heterodox economics. HETERODOX ECONOMIST: [...]

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Philip Pilkington Interviews Marc Lavoie [Updated]

19 June 2012

Philip Pilkington’s interview of Marc Lavoie on his textbook Monetary Economics is available to read at Naked Capitalism. New Directions in Monetary Economics: An Interview with Marc Lavoie – Part I (Update: Part 2 appears here: New Directions in Monetary Economics: An Interview with Marc Lavoie – Part II) Wynne Godley used to think that Keynesians were being [...]

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Toward A Higher European Integration?

3 June 2012

In an article today Europe Mulls Major Step Towards “Fiscal Union”, Reuters reports that Angela Merkel is pushing for a “giant leap forward”: After falling short with her “fiscal compact” on budget discipline, German Chancellor Angela Merkel is pressing for much more ambitious measures, including a central authority to manage euro area finances, and major new [...]

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Debt Monetization

22 April 2012

Let us take the public sector budget equation: G – T = ΔH + ΔB Inspired by Milton Friedman’s popularity in the 1970s and the 80s, most textbooks and journal articles incorrectly claim that the central bank “controls” the money stock (such as M0, M1, M2 etc). Simultaneously they also claim – rightly – that the central [...]

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G&L’s Monetary Economics – Second Edition

15 April 2012

I got my copy of Monetary Economics by Wynne Godley and Marc Lavoie yesterday. I know some people were waiting for the second edition of the book, and had postponed their purchase to get the newer edition – so they can get it now! There aren’t any changes in this edition – except for correction [...]

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Kaldor’s Reflux Mechanism

12 April 2012

The recent debates of Post Keynesians with Neoclassical/New Keynesians has highlighted that the latter group continues to hold Monetarists’ intuitions. Somehow the exogeneity of money is difficult for them to get rid of, in spite of their statements and rhetoric that money is endogenous in their models. So there is an excess of money in [...]

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Open Mouth Operations

5 April 2012

In the previous post Is Paul Krugman A Verticalist?, I discussed the confusions economists and market commentators have on open market operations. Even top economists such as Krugman suffer from confusions on central banking and monetary matters. I also mentioned the work of Alfred Eichner on bringing out more clarity on the defensive nature of [...]

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Is Paul Krugman A Verticalist?

31 March 2012

24 years back, Basil Moore wrote a book Horizontalists And Verticalists: The Macroeconomics Of Credit Money (Cambridge University Press, 1988) which begins like this: The central message of this book is that members of the economics profession, all the way from professors to students, are currently operating with a basically incorrect paradigm of the way modern [...]

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Income And Expenditure Flows And Financing Flows

13 February 2012

In the previous two posts, I went into a description of the transactions flow matrix and the balance sheet matrix as tools for an analytic study of a dynamical study of an economy. During an accounting period, sectors in an economy are making all kinds of transactions. These can be divided into two kinds: Income [...]

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Sources And Uses Of Funds

9 February 2012

In a recent post, I went into what is called the Transactions Flow Matrix. This is used heavily in Stock-Flow Consistent Modeling of the whole economy. The underlying theme is “everything comes from somewhere and goes somewhere, and there are no black holes”. I also mentioned about a Balance Sheet Matrix. What is it? Sectors [...]

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