Is exchange rate depreciation inflationary?

Bill Mitchell puudutab oma postituses seda MMT vastast argumenti, mida kõige sagedamini kasutatakse ja mida isegi mainstream vasakpoolsed kasutavad MMT vastu, sest nad on neoliberaalid, kes ei taha tunnistada, et nad on täistööhõive poliitika vastu. Nad ütlevad: MMT ei tööta mitte mingil juhul.  Nende “poliitiline pilv” koosneb ümberjagamise ideoloogiast, muus osas nad praktiliselt täielikult nõustuvad neoklassiklalise majandusteooriaga: rikkad miljonärid loovad majanduslikku väärtust ja neilt tuleks osa ära võtta ning vaestele anda, sest nii on õiglane.

Mina liigitaksin selliste hulka Tsiprased ja Varoufakised kindlasti (lugeja võiks nüüd öelda, et need mehed küll neoliberaalid pole, mina väidan, et enda majanduslikult mõtlemiselt nad on seda, nad peavad tulemit ebaõiglaseks ja tahavad igal juhul sekkuda lihtsalt).MMT nendega ühes paadis pole.

Ma pole ise osanud kuigi hästi seda argumenti siin adresseerida, kuigi rääkinud sellest põgusalt olen või vähemalt olen selle kaldorlaste argumendi õhku visanud siin.

Is exchange rate depreciation inflationary?

One of the first things that conservatives (and most economists which is typically a highly overlapping set) raise when Modern Monetary Theory (MMT) proponents suggest that increased deficits are essential to reduce mass unemployment is the so-called balance of payments constraint. Accordingly, we are told that the capacity of a nation to increase domestic employment is limited by the external sector. And these constraints have become more severe in this age of multinational firms with their global supply chains and the increased volume of global capital flows. I will address the specific issue of a balance of payments constraint on real GDP growth (that is, the limits of fiscal stimulus) in a future blog. But today I want to consider the so-called Exchange Rate Pass-Through (ERPT) effects of that are part of the balance of payments constraint story. The mainstream narrative goes like this. Higher wage demands associated with full employment and/or stronger imports associated with higher fiscal deficits lead to external imbalances due to rising imports and loss of competitiveness in international markets (eroding export potential). In a system of flexible exchange rates, the currency begins to lose value relative to all other currencies and the rising import prices (in terms of the local currency) are passed-through to the domestic price level – with accelerating inflation being the result. If governments persist in pursuing domestic full employment policies the domestic inflation worsens and the hyperinflation is the result, with a chronically depreciated currency. Real standards of living fall and a general malaise overwhelms the nation and its citizens. I am sure you have heard that narrative before – it is almost a constant noise coming from the deficit phobes. Like most of the conservative economic claims and I include the austerity-lite Leftist parties in this group, it turns out that reality is a bit different. Here is some discussion on that issue……

 

About Kristjan

Defitsiidi terrorismi vastase pataljoni eriüksuslane (finantsignorantsuse vastu võitlemise osakond). Treening: MMT, postkeinsism, Tartu Ülikool Majandusteadus
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