Monetary Policy 101

In this paper the main developments in post-Keynesian macroeconomics since the mid- 1990s will be reviewed. For this purpose the main differences between heterodox economics in general, including post-Keynesian economics, and orthodox economics will be reiterated and an overview over the strands of post-Keynesian economics, their commonalities and developments since the 1930s will be outlined. This will provide the grounds for touching upon three important areas of development and progress of post-Keynesian macroeconomics since the mid-1990s: first, the integration of distribution issues and distributional conflict into short- and long-run macroeconomics, both in theoretical and in empirical/applied works; second, the integrated analysis of money, finance and macroeconomics and its application to changing institutional and historical circumstances, like the process of financialisation; and third, the development of full-blown macroeconomic models, providing alternatives to the mainstream 'New Consensus Model' (NCM), and allowing to derive a full macroeconomic policy mix as a more convincing alternative to the one implied and proposed by the mainstream NCM, which has desperately failed in the face of the recent crises.

Maria Nikolaidi on how Minsky’s theory has been modelled over past decades and how one can use these models in order to analyse contemporary issues such as financial fragility and financial instability caused by climate change.

The vast uncertainty surrounding the possible spread of COVID-19 and the duration of the near-economic standstill required to combat it make forecasting little different from guessing. Clearly, this is a “whatever-it-takes” moment for large-scale, outside-the-box fiscal and monetary policies.

The concept of financialisation has undergone a similar career as ‘globalisation’, ‘neoliberalism’ or even ‘capitalism’, in the course of which it changed from the explanandum to the explanans; the process of financialisation is taken for granted, while the concrete historical and empirical causal conditions of its realisation and perpetuation are being moved into the background.

„Postwachstum“ ist seit über einem Jahrzehnt ein zentraler Teil der Debatte über alternative Wirtschaftsformen. Doch der Ansatz zeigt große Schwächen, wenn es um die Frage der politischen Umsetzung geht. Vielleicht wäre es Zeit für einen Paradigmenwechsel und eine Debatte über ökonomische Planung. Samuel Decker umreißt im diesem ersten Teil der Artikelreihe den sozial-ökonomischen Ist-Zustand und warnt vor gefährlichen politischen Trends. Im zweiten Teil werden die zentralen Probleme des Degrowth-Ansatzes beleuchtet. Im dritten Teil die neue Planungsdebatte als Ansatz zur Bewältigung der drängendsten sozialen und ökologischen Probleme unserer Zeit eingeführt.

In diesem Text aus der Reihe "Exploring Economics - Foundations" werden die Grundlagen der Internationalen Politischen Ökonomie als interdisziplinäre wissenschaftliche Strömung dargestellt.