This paper surveys the wreckage of modern monetary theory and policy which follow from the disappearance of the modern quantity theory of money, and its empirical counterpart, the modern stock of fiat money.2 In order of significance, the consequences are (1) the disappearance of any optimum money supply policies, (2) vanishing internally consistent costs of inflation and (3) the theoretical revitalization of Keynesian economics stemming from recognition that the common impression Keynes was guilty of theoretical error is not correcting economies where ‘money’ plays a real role.
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Paper provided by Carleton University, Department of Economics in its series Carleton Economic Papers with number
04-14.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Woodford, Michael, 1990.
"The optimum quantity of money,"
Handbook of Monetary Economics,
in: B. M. Friedman & F. H. Hahn (ed.), Handbook of Monetary Economics, edition 1, volume 2, chapter 20, pages 1067-1152
Elsevier.
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