A new paradigm for macroeconomic policy

Arestis, Philip; Sawyer, Malcolm

doi:10.1504/ijpp.2011.039573

Cited by 10 publications

(4 citation statements)

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“…To address these issues, Arestis and Sawyer (2011) go beyond the theoretical framework of the NCM in the search for a theoretical paradigm and a set of economic policies that can lead the economy to an economic performance superior to that reached with the adoption of the NCM. Thus, the authors propose the analysis of a monetary production economy where financing and credit play a significant role; the economy is subject to instability, and inadequacy of aggregate demand and the level and distribution of productive capacity may often be inadequate to sustain full employment of labor.…”

Section: Rethinking Monetary Policy: the Current International Debatementioning

confidence: 99%

“…In addition, authors such as Blanchard (2017), Blanchard and Lawrence Summers (2017), Robert Solow (2018), and Paul Romer (Forthcoming) argue that the effects of monetary policy on the economy are real and go far beyond just maintaining price stability, breaking in some ways from the key economic policy recommendations of the NCM. Some other authors like Philip Arestis and Malcolm Sawyer (2011) go even further, seeking a theoretical paradigm and a set of economic policies that can lead economies to an economic performance superior to that achieved through the NCM.…”

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Lessons from the 20 years of the Brazilian inflation targeting regime

Araújo

Arestis

2019

Panoeconomicus

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This paper analyzes the Brazilian experience with the inflation targeting regime (ITR) since its adoption in June 1999. The theoretical analysis starts by covering the New Consensus Macroeconomics (NCM) only policy, in which the ITR is the monetary policy recommendation. This discussion is then complemented first by the current debate in the international mainstream on the need for a flexible ITR that considers the effects of monetary policy on the economy and second by the heterodox discussion on the need to completely abandon the ITR. The discussion on the Brazilian experience and its comparison with international experiences show that Brazil is one of the few countries where the monetary policy objective is restricted to price control and where the horizon for returning inflation to the target is only one year. Within this institutional framework, the Brazilian economy under the ITR is marked by the maintenance of extremely high real and nominal interest rates and with difficulties in meeting the inflation targets. The price control obtained also did not generate the expected externalities in terms of economic growth and employment. After almost 20 years of adopting the ITR in Brazil, it has generated exaggerated contractionary pressures on the Brazilian economy, indicating the need for a thorough examination of monetary institutions in Brazil in order to resume economic growth with price stability and social equity.

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Section: Rethinking Monetary Policy: the Current International Debatementioning

confidence: 99%

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confidence: 99%

Lessons from the 20 years of the Brazilian inflation targeting regime

Araújo

Arestis

2019

Panoeconomicus

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“…Thus, Post Keynesian analysis relies on the basic insights of Keynes and Kalecki. For more details, see Geoffrey Harcourt (2006), Philip Arestis and Malcolm Sawyer (2011), Hein and Stockhammer (2011), Lavoie and Stockhammer (2012) and Sawyer (2012). It is important to mention that, on the one hand, considering the Post Keynesian Agenda, this paper focuses only on macroeconomic policy and, on the other hand, its analysis is based, mainly, on Keynes' writings.…”

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Keynesian macroeconomic policy: Theoretical analysis and empirical evidence

2018

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Investment depends on subjective factors, such as expectations, conventions, and confident animal spirits. In a context of economic instability and crises, economic policy is the main source to support entrepreneurs? expectations and investment. In this sense, macroeconomic policies are capable of affecting effective demand and building a good institutional environment, which is essential to keep the entrepreneurs? expectations confident and promote their animal spirits. Given these propositions, this contribution has two objectives. The first is to develop a Keynesian type of macroeconomic policy able to stimulate investment and effective demand, and, as a result, mitigate unemployment. The idea is to offer alternative macroeconomic policy prescriptions in relation to the New Consensus Macroeconomics one. This proposal aims to establish the role, according to the Post Keynesian view, the logic of operation of each policy, and the proper coordination among these Keynesian macroeconomic policies. The second objective is to present, briefly, relevant empirical evidence of the Post Keynesian macroeconomic policies.

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“…194 Although this policy plan draws upon Hein and Truger (2010) and Hein (2012), a similar alternative approach to EMU macroeconomic policy and institutional design has been provided by Argitis (2011), Arestis and Sawyer (2011) and Hein and Stockhammer (2010), as well as by the various annual reports published by the EuroMemo Group of European Economists for an Alternative Economic Policy in Europe.…”

Section: Disciplinary Financialisation and Functional Income Distribution In Emumentioning

confidence: 99%

EMU macroeconomic policy regime

Koratzanis¹

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A new paradigm for macroeconomic policy

Cited by 10 publications

References 19 publications

Lessons from the 20 years of the Brazilian inflation targeting regime

Lessons from the 20 years of the Brazilian inflation targeting regime

Keynesian macroeconomic policy: Theoretical analysis and empirical evidence

EMU macroeconomic policy regime

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