Economics Questions

Re: A critique of Modern Monetary Theory?

Fool on the Hill — Mon, 19 Dec 2011 00:17:02 GMT

I confess I seem to use a different system of logic than Fool on the Hill.

Nah, probably just different definitions and assumptions.

Re: A critique of Modern Monetary Theory?

Smiling Dave — Sun, 18 Dec 2011 03:43:22 GMT

MMT has been refuted by me and by others right here:

http://mises.org/Community/forums/t/22477.aspx

and here:

http://mises.org/Community/forums/t/22452.aspx

and here:

http://mises.org/Community/forums/p/22477/395425.aspx

Also I blogged about it here:

http://smilingdavesblog.blogspot.com/2011/08/are-mmt-and-ae-compatible.html

One of the threads has a guest appearance by Walter Mosler himself, with a long back and forth between him and the forum members.

I confess I seem to use a different system of logic than Fool on the Hill.

Re: A critique of Modern Monetary Theory?

Fool on the Hill — Sun, 18 Dec 2011 02:42:25 GMT

I don't understand all of the hostility towards MMT. Seems pretty reasonable to me. I defended it in another thread.

Re: A critique of Modern Monetary Theory?

neutrinoman — Thu, 15 Dec 2011 20:34:18 GMT

Yes, I do realize. I was researching MMT on the Web and came across articles and postings from the last couple years.

Re: A critique of Modern Monetary Theory?

HamsterHuey — Thu, 15 Dec 2011 03:06:01 GMT

You're the MMTer, why don't you enlighten me, my mind is open.

I'm not making any claims about this guy, just noting that he hasn't refuted the criticism of MMT at all.

Apparently, he is trying to present a theory, right? Modern Monetary Theory. This implies that there is some kind of value-free science behind it, doesn't it? Yet his first line of defense against criticism is to pass judgment upon the moral and mental state of all humanity! As Bill Hicks would say: How f***ing scientific!

And the basic claim seems to be that "The govt has no financial constraint.", but then again they should not drop money from helicopters lest "death of currency" ensue. How is this not a financial constraint? And on he goes, making claims, then claiming the opposite and accusing his critic of strawmanning.

So yeah, no refuting going on. Why don't you try?

Re: A critique of Modern Monetary Theory?

John James — Wed, 14 Dec 2011 23:24:39 GMT

neutrinoman, you do realize you bumped a thread that is over a year and a half old, and are talking to a guy who hasn't visited these forums in almost that same amount of time...?

Re: A critique of Modern Monetary Theory?

MMter — Wed, 14 Dec 2011 19:30:28 GMT

Cullen Roche is an entrepreneur and a conservative. There's no chance he's the socialist you make him out to be. You might do yourself a favor by being a little more open minded about MMT. It's not what you claim it is.

Re: A critique of Modern Monetary Theory?

HamsterHuey — Wed, 14 Dec 2011 11:56:35 GMT

I don't see how anything has benn refuted, soundly or otherwise. The author concedes almost every point, only insisting that "we" are by nature corrupt and irrational as though, if true, this would justify monetary manipulation by gov't. But if humans are naturally this way, where will we find wise and decent folks to do the job?

Of course it's not true. What we are by nature is ignorant and self-interested; harmless traits absent coercive power over others.

To paraphrase: His government utopia is not applicable to a world in which men are self-interested and ignorant.

Re: A critique of Modern Monetary Theory?

MMter — Tue, 13 Dec 2011 19:03:24 GMT

Cullen Roche soundly refuted that article a long time ago. Mercenary Trader doesn't even come close to understanding MMT. http://pragcap.com/discussion-forum?mingleforumaction=viewtopic&t=42

Re: A critique of Modern Monetary Theory?

neutrinoman — Tue, 13 Dec 2011 16:08:29 GMT

The school you're thinking of is Chartalism. Here's a Wikipedia article (which I have not fully read, so caveat emptor): http://en.wikipedia.org/wiki/Chartalism

Here's a terrific article on Modern Monetary Theory at the Seeking Alpha website: http://seekingalpha.com/article/242669-the-trouble-with-modern-monetary-theory

The author seems to understand the theory better than do its advocates. He brushes aside the apparent problems to get to the real issues.

Keynesianism has a certain overlap with MMT, but Keynes wouldn't follow his own flawed ideas to their logical conclusion and he never went as far as MMT does. Some Keynesians nowadays almost talk this way. But even Krugman refused to go down the MMT route, because he knows it would make him into the economic equivalent of a believer in perpetual motion or antigravity and destroy his reputation as an economist.

Re: A critique of Modern Monetary Theory?

Think Blue — Tue, 20 Jul 2010 21:38:51 GMT

Hi razerfish. I think I found what you're looking for. Robert Murphy, an Austrian Economist, actually wrote a critique about some of their ideas, but without realizing they were Chartalists.

I posted the links on the other thread, so as to avoid duplicate posts:

http://mises.org/Community/forums/p/18268/349054.aspx

Re: A critique of Modern Monetary Theory?

Think Blue — Tue, 20 Jul 2010 15:05:41 GMT

Here is a blog discussion between a Chartalist and some Austrians:

Mises Economics Blog

Re: A critique of Modern Monetary Theory?

Think Blue — Mon, 19 Jul 2010 20:44:11 GMT

razerfish:
This what AP Lerner over at Professor Anderson's blog was going on about. Also called Charlatism (ouch, not a marketable name if I may say so).

Heh. That would be Chartalism, not Charlatism. Maybe some charlatans didn't bother picking a better name. :)

razerfish:
I did some surfing to find critiques of this theory, but didn't really find any. Can someone point me toward a thorough critique?

Unfortunately, I don't have time to analyze their theory, and since they're so outside the mainstream, it seems nobody else has bothered to criticize them.

But if you encounter AP Lerner (or his ilk) again, just say "he's a Chartalist!!, and I'm sure they'll be none to happy you didn't use their re-branded term "Modern Monetary Theory."

Re: A critique of Modern Monetary Theory?

chloe732 — Mon, 19 Jul 2010 05:36:46 GMT

I think the theory is a train wreck. Did you see Think Blue's summary on the other thread (Public deficits = private savings)? It sounds like Resource Based Economics (Zeitgeist) to me. The theory is so bad I can't see how anyone would have spent the time to critique it.

A critique of Modern Monetary Theory?

razerfish — Mon, 19 Jul 2010 04:31:38 GMT

This what AP Lerner over at Professor Anderson's blog was going on about. Also called Charlatism (ouch, not a marketable name if I may say so).

I did some surfing to find critiques of this theory, but didn't really find any. Can someone point me toward a thorough critique?

And apropos of nothing, I happened to notice a name that seemed familiar. Abba P. Lerner is credited for reviving the theory in recent times, according to Wikipedia. Here I thought AP Lerner was a cute way of calling yourself an Advanced Placement Learner. Oh, well, learn something new every day.