Functional Finance: What, Why, and How?
The purpose of this paper is threefold. First, the theory of functional finance, as explicated by its originator, Abba P. Lerner, is put forward. Second, the reader is introduced to the use, standard in money and banking texts, of T-account balance sheet entries. Although no important conclusions will rest solely on the reader's ability to cope with these entries, comfort with their use will ease the exposition. An appendix therefore is provided to assist those not yet exposed to this method of recording balance sheet changes and for those who merely wish to refresh themselves. The third purpose of the paper is to demonstrate the need for policies governed by the principles of functional finance.
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.:
- Smith, B.D. & Villamil, A.P., 1991.
"Government Borrowing using Bonds with Randomly Determined Returns : Welfare Improving Randomization in the Context of Deficit Finance,"
RCER Working Papers
287, University of Rochester - Center for Economic Research (RCER).
- Smith, Bruce D. & Villamil, Anne P., 1998. "Government borrowing using bonds with randomly determined returns: Welfare improving randomization in the context of deficit finance," Journal of Monetary Economics, Elsevier, vol. 41(2), pages 351-370, April.
- Victoria Chick, 1983. "Macroeconomics after Keynes: A Reconsideration of the General Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262530457, September.
When requesting a correction, please mention this item's handle: RePEc:lev:wrkpap:wp_287. 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: (Marie-Celeste Edwards)
If references are entirely missing, you can add them using this form.