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Soft Currency Economics


  • Warren Mosler


This evolutionary paper traces the interaction of monetary and fiscal policy, assuming lag reserve accounting in a fiat monetary system. It illustrates: Sovereign debt functions as interest rate support. Taxes function to create a demand for federal spending. The myth of the money multiplier. Taxed advantaged savings plans create a need for deficit spending. Exports are the cost of imports.

Suggested Citation

  • Warren Mosler, 1995. "Soft Currency Economics," Macroeconomics 9502007, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpma:9502007
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    Cited by:

    1. Mathew Forstater, 2013. "Time of production, time of circulation and turnover time: exploring the guts of Marx’s circuits of capital," Chapters, in: Louis-Philippe Rochon & Mario Seccareccia (ed.), Monetary Economies of Production, chapter 4, pages 33-40, Edward Elgar Publishing.
    2. L. Randall Wray, 2014. "From the State Theory of Money to Modern Money Theory: An Alternative to Economic Orthodoxy," Economics Working Paper Archive wp_792, Levy Economics Institute.
    3. L. Randall Wray, 1997. "Government as Employer of Last Resort: Full Employment without Inflation," Economics Working Paper Archive wp_213, Levy Economics Institute.
    4. Ryan S. Mattson & Rex Pjesky, 2019. "Approaching Modern Monetary Theory with a Taylor Rule," Economies, MDPI, vol. 7(4), pages 1-13, September.
    5. Marc Audi & Amjad Ali, 2023. "Public Policy and Economic Misery Nexus: A Comparative Analysis of Developed and Developing World," International Journal of Economics and Financial Issues, Econjournals, vol. 13(3), pages 56-73, May.
    6. Mathew Forstater, 1998. "Toward a New Instrumental Macroeconomics: Abba Lerner and Adolph Lowe on Economic Method, Theory, History, and Policy," Economics Working Paper Archive wp_254, Levy Economics Institute.
    7. Warren Mosler, 2002. "A Critique of John B. Taylor’s “Expectations, Open Market Operations, and Changes in the Federal Funds Rate”," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 24(3), pages 419-422, March.
    8. L. Randall Wray, 2014. "Outside Money: The Advantages of Owning the Magic Porridge Pot," Economics Working Paper Archive wp_821, Levy Economics Institute.

    More about this item

    JEL classification:

    • E - Macroeconomics and Monetary Economics


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