(Post) Keynesian alternative to inflation targeting
While the mainstream policies can not be surpassed in the enchanted ‘optimizable'world, (Post) Keynesians have to resign themselves to manage without magic wand inthe uncertain real world. The paper discusses the monetary rules proposed in the recentPost Keynesian literature. It argues that the long-term interest rate is too imperfectlycontrolled for such rules being feasible. Consequently, the quest for credibility isirrelevant, for it makes not much sense to wonder whether authorities will honour theircommitment on an unfeasible ideal target. The right question is whether authoritiespursue convincing objectives so as to move the conventional expectation of the future(and the related interest rate) towards full employment. It is a matter of confidence.The basic principles involved in such an approach to economic policy are discussed.
|Date of creation:||04 Apr 2008|
|Date of revision:|
|Publication status:||Published in Inflation targeting, is there a crediblealternative? Organized by the PostKeynesian Study Group, Balliol College., Apr 2008, Oxford, United Kingdom|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00335560|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
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.:
- Dixit, Avinash & Lambertini, Luisa, 2003. "Symbiosis of monetary and fiscal policies in a monetary union," Journal of International Economics, Elsevier, vol. 60(2), pages 235-247, August.
- Thomas I. Palley, 2007. "Macroeconomics and monetary policy: competing theoretical frameworks," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 30(1), pages 61-78, October.
- Philip Arestis & Malcolm Sawyer, 2003.
"The Case for Fiscal Policy,"
Economics Working Paper Archive
wp_382, Levy Economics Institute.
- Giuseppe Fontana & Alfonso Palacio-Vera, 2007.
"Are Long-Run Price Stability And Short-Run Output Stabilization All That Monetary Policy Can Aim For?,"
Wiley Blackwell, vol. 58(2), pages 269-298, 05.
- Giuseppe Fontana & Alfonso Palacio- Vera, 2005. "Are Long-Run Price Stability and Short-run Output Stabilization All that Monetary Policy Can Aim For?," Macroeconomics 0511024, EconWPA.
- Giuseppe Fontana & Alfonso Palacio-Vera, 2005. "Are Long-run Price Stability and Short-run Output Stabilization All that Monetary Policy Can Aim For?," Economics Working Paper Archive wp_430, Levy Economics Institute.
- H. Sonmez Atesoglu, 2007. "The neutral rate of interest and a new monetary policy rule," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 29(4), pages 689-697, July.
- Davidson, Paul, 1972. "Money and the Real World," Economic Journal, Royal Economic Society, vol. 82(325), pages 101-15, March.
- Philip Arestis & Malcolm Sawyer, 2004. "On the Effectiveness of Monetary Policy and of Fiscal Policy," Review of Social Economy, Taylor & Francis Journals, vol. 62(4), pages 441-463.
- Eckhard Hein & Engelbert Stockhammer, 2010.
"Macroeconomic Policy Mix, Employment and Inflation in a Post-Keynesian Alternative to the New Consensus Model,"
Review of Political Economy,
Taylor & Francis Journals, vol. 22(3), pages 317-354.
- Eckhard Hein & Engelbert Stockhammer, 2007. "Macroeconomic policy mix, employment and inflation in a Post-Keynesian alternative to the New Consensus Model," Department of Economics Working Papers wuwp110, Vienna University of Economics and Business, Department of Economics.
- Vercelli,Allessandro, 1991. "Methodological Foundations of Macroeconomics," Cambridge Books, Cambridge University Press, number 9780521392945, June.
- Gilberto Tadeu Lima & Mark Setterfield, 2007.
"Inflation Targeting And Macroeconomic Stability In A Post Keynesian Economy,"
Anais do XXXV Encontro Nacional de Economia [Proceedings of the 35th Brazilian Economics Meeting]
174, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
- Gilberto Tadeu Lima & Mark Setterfield, 2008. "Inflation targeting and macroeconomic stability in a Post Keynesian economy," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 30(3), pages 435-461, April.
- Alcino F. Câmara Neto & Matias Vernengo, 2004. "Fiscal policy and the Washington consensus: a Post Keynesian perspective," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 27(2), pages 333-343, December.
- Philip Arestis & Malcolm Sawyer, 2003.
"Reinventing fiscal policy,"
Journal of Post Keynesian Economics,
M.E. Sharpe, Inc., vol. 26(1), pages 3-25, October.
- Louis-Philippe Rochon & Mark Setterfield, 2007. "Interest rates, income distribution, and monetary policy dominance: Post Keynesians and the "fair rate" of interest," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 30(1), pages 13-42, October.
- Benassy, Jean-Pascal, 2007.
"IS-LM and the multiplier: A dynamic general equilibrium model,"
Elsevier, vol. 96(2), pages 189-195, August.
- Jean-Pascal Bénassy, 2006. "IS-LM and the multiplier: A dynamic general equilibrium model," PSE Working Papers halshs-00590513, HAL.
- John Smithin, 2007. "A real interest rate rule for monetary policy?," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 30(1), pages 101-118, October.
- Thomas I. Palley, . "The Role of Institutions and Policies in Creating High European Unemployment: The Evidence," Economics Working Paper Archive wp_336, Levy Economics Institute.
- Angel Asensio, 2006. "New-Consensus Macroeconomic Governance in a Keynesian world, and the Keynesian alternative," Post-Print halshs-00139113, HAL.
- Geoff Tily, 2006. "Keynes's theory of liquidity preference and his debt management and monetary policies," Cambridge Journal of Economics, Oxford University Press, vol. 30(5), pages 657-670, September.
- Mark Setterfield, 2007. "Is There a Stabilizing Role for Fiscal Policy in the New Consensus?," Review of Political Economy, Taylor & Francis Journals, vol. 19(3), pages 405-418.
- Paul Davidson, 2006. "Can, or should, a central bank inflation target?," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 28(4), pages 689-703, July.
When requesting a correction, please mention this item's handle: RePEc:hal:journl:halshs-00335560. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD)
If references are entirely missing, you can add them using this form.