Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/300502 
Year of Publication: 
2024
Series/Report no.: 
Working Paper No. 1052
Publisher: 
Levy Economics Institute of Bard College, Annandale-on-Hudson, NY
Abstract: 
For Matías Vernengo and Esteban Pérez Caldentey (2020), the MMT literature overemphasizes the choice of the exchange rate regime and the relevance of a flexible exchange rate regime, as well as the ultimate effect of that choice upon the policy space. In addition, they argue that the role of capital flows is underexplored, and that the relevance of the balance-of-payments constraint is often underestimated. Vernengo and Pérez's criticism fails to consider that exchange-rate flexibility makes it possible to use flexible fiscal and monetary policies as well, to boost growth and employment, and to reduce the balance-of-payments constraint.
Subjects: 
Capital Mobility
Currency
Exchange Rate
Financial Sector
Fiscal Policy
Foreign
Exchange Policy
Government Spending
Interest Rates
Monetary Policy
Real Activity
JEL: 
E42
E43
E44
O23
O24
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.