Rethinking the Theory of Money, Credit, and Macroeconomics: A New Statement for the Twenty-First Century

Description

This book provides a comprehensive re-working of the basic principles of monetary macroeconomics in an alternative monetary model (AMM) of economic growth, the business cycle, inflation and income distribution. These principles differ considerably from those advanced in the standard macroeconomics literature and in textbooks. However, the latter have been demonstrably unsuccessful in the promotion of usable macroeconomic policy advice for the past several years, actually decades. A different approach is needed. In particular, the new approach takes seriously the vital role of credit creation and endogenous money in capitalism. It does not imagine that all of the difficult questions of economic policy-making may be resolved within a paradigm that conceptualizes economic activity as merely a question of barter exchange. The result is a blueprint for a set of growth-friendly macroeconomic policies which will promote full employment, financial stability and higher real wages – essentially for the benefit of the long-suffering middle and working classes rather for the chamber of commerce and financial interests. Cover Rethinking the Theoryof Money, Credit,and Macroeconomics Rethinking the Theory of Money, Credit, and MacroeconomicsA New Statement for the Twenty-First Century Copyrigth page Contents List of Figures List of Tables Preface Chapter 1 Methodological Problems in Monetary Macroeconomics Monetary Analysis versus Real Analysis Methodological Problems in Mainstream Macroeconomics Is Anything Worth Salvaging from the Wreckage? What Is the Correct Methodology for Monetary Macroeconomics? Is There a Better Way? Relation of the Current Volume to Previous Research Conclusion Notes Chapter 2 The Basic Principles of Macroeconomics in an Alternative Monetary Model Exchange Rate Regimes and International Economic Relations “Stabilizing an Unstable Economy”? A Real Interest Rate Rule for Monetary Policy? The Alternative Monetary Model The Business Cycle The Steady-State Long-Run Multipliers The Political Economy of Fiscal Policy The Fallacy of a Positive Balanced Budget Multiplier Graphical Analysis of the AMM Conclusion Notes Chapter 3 The Role of Money and Banking in Capitalism Two Competing Theories of Money: Commodity Theory versus Credit Theory Conclusion Notes Chapter 4 The Mystery of Profit and the Enigma of Value Conclusion Notes Chapter 5 Interest Rates, Liquidity Preference, and Endogenous Money Conclusion Appendix: How Does the Central Bank Set the Policy Rate of Interest? Notes Chapter 6 Interest, Profit, and Wages Conclusion Notes Chapter 7 Alternative Approaches to the Theory of Economic Growth Conclusion Notes Chapter 8 Alternative Views on Inflation Conclusion Notes Chapter 9 The Balance of Payments and Exchange Rates Conclusion Notes Chapter 10 A Realist Approach to International Currency and Finance Capitalism in One Country? Conclusion Notes Chapter 11 Towards a Philosophy of Money and Finance? Conclusion Notes Bibliography Index About the Author