Heikki Patomäki: Modern Monetary Theory – Populist Rhetoric or a Credible Alternative?
Modern monetary theory (MMT) has gained increasingly widespread academic and political interest. Its upward popularity trend seems to follow the formula “first they ignore you, then they laugh at you, then they fight you, then you win”. Or so, at least, an MMT-optimist might think.
What is clear is that MMT has reached the fight-stage. Neo-Keynesians like Paul Krugman have attacked MMT raucously in public and the theory has been the subject of constant debate. While most academic papers and books on MMT have so far been published in heterodox outlets, mainstream economists have begun to take MMT seriously, and perhaps especially so within central banks. One illuminating example of ongoing discussions is the October 2019 special issue of the real world economics review. It brings together some of the most prominent proponents of the theory, as well as post-Keynesian and other critics….
