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After the Bazooka a Bonanza from Heaven – „Helicopter Money“ Now?


  • Ansgar Belke


Helicopter money has once been proposed as a theoretical thought experiment by Milton Friedman in order to elucidate the effect of money injections into the macroeconomy over time. However, some Euro area member states nowadays consider helicopter money, i.e. permanent Quantitative Easing (QE), as a permanent ingredient of future EMU governance. We set helicopter money apart from QE monetary policy measures and also distinguish it from a traditional fiscal stimulus. We then deal with and critically assess further developments of the helicopter money idea à la Bernanke und Buiter. Furthermore, the paper then comes up with three practical variants of helicopter money, basically available for the European Central Bank. Taking this as a starting point, the pros and cons of helicopter money and its closely defined implementation conditions are discussed. Finally, we derive some implications of helicopter money implementation for the monetary system as a whole.

Suggested Citation

  • Ansgar Belke, 2018. "After the Bazooka a Bonanza from Heaven – „Helicopter Money“ Now?," ROME Working Papers 201802, ROME Network.
  • Handle: RePEc:rmn:wpaper:201802

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    More about this item


    economic stimulus programmes; full reserve banking; helicopter money; interest rate; joint analysis of fiscal and monetary policy; Quantitative Easing;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy

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