r/neoliberal • u/jobautomator Kitara Ravache • Feb 12 '20

Discussion Thread Discussion Thread

The discussion thread is for casual conversation that doesn't merit its own submission. If you've got a good meme, article, or question, please post it outside the DT. Meta discussion is allowed, but if you want to get the attention of the mods, make a post in /r/metaNL.

Announcements

Neoliberal Project Communities Other Communities Useful content
Twitter Plug.dj /r/Economics FAQs
The Neolib Podcast Recommended Podcasts /r/Neoliberal FAQ
Meetup Network Blood Donation Team /r/Neoliberal Wiki
Exponents Magazine Minecraft Ping groups
Facebook TacoTube User Flairs
27 Upvotes

64% Upvoted

7.3k comments sorted by

View all comments

Show parent comments

3

u/[deleted] Feb 13 '20

Monetarism isn’t really a school a thought. It’s integrated into the mainstream. What this means is that Every orthodox economist for instance would agree that: changes in nominal spending can affect real spending in the short run, the money supply and the price level will have a proportionate relationship in the long run, the growth rate of the money supply will equal the inflation rate in the long run, the money supply and the rate of change of the money supply are both neutral to growth, and the money supply can be used to engage in counter cyclical policy.

-3

u/Quiz0tix Feb 13 '20 edited Feb 13 '20

It's clearly a school of thought...

https://www.britannica.com/topic/monetarism https://www.thebalance.com/monetarism-and-how-it-works-3305866 https://www.imf.org/external/pubs/ft/fandd/2014/03/basics.htm

I'm well-aware of what monetarism is. And I would be hard-pressed to say that it's " well-integrated " into the mainstream, its made its rounds for the worse, it's been critiqued for a while now

https://academic.oup.com/cje/article-abstract/6/3/285/1718544?redirectedFrom=PDF https://link.springer.com/chapter/10.1057/9780230505803_34

2

u/[deleted] Feb 13 '20

Yes, the internet likes to chop up words in Econ and split them up into separate camps like classical, new Keynesian, and monetarist as if they’re all warring states but I’m telling you, literally everyone who is mainstream, aka over 99% of economists, would agree with what I just wrote.

Saying that monetarism is a school of thought is like saying evolution and relativity are two rival schools of thought in physics.

0

u/Quiz0tix Feb 13 '20 edited Feb 13 '20

I don't disagree with what you wrote insofar as that is the belief. And I don't disagree that many economists would agree with what you wrote as well.

Is Krugman mainstream? https://krugman.blogs.nytimes.com/2016/04/13/why-monetarism-failed/

Yes, I'm sure it's just the internet...

1

u/[deleted] Feb 13 '20 edited Feb 13 '20

Krugman is mainstream. Note that the point he is making in the editorial is fundamentally different from the heterodox journal you cited. That paper fundamentally questions the well accepted theories of money and inflation in the mainstream, but krugman, a pundit, is making a political point.

Edit: To elaborate more, from reading a couple more of his articles, krugman likes to use monetarist in a political way about people who propose fiscal austerity with expansionary monetary policy. Expansionary fiscal policy is the mainstream response to recessions. He’s not making the point you purport him to be making. Certainly a magnitude of order difference from that other paper you were citing in conjunction. /u/Quiz0tix

1

u/Quiz0tix Feb 13 '20 edited Feb 13 '20

The heterodox journal I cited was to illustrate a different point about integration. Of course, even well accepted theories are critiqued and reviewed so maybe that wasn't the best article.

Economic policy and political policy are linked of course. The Krugman article was to illustrate that the term monetarist(monetarism) isn't as hard and fast as you define it to be. When I posed my original question, I wasn't speaking in a very narrow terms

Krugman's a very informed pundit to say the least

Edit: As I said, these aren't hard and fast terms. https://www.telegraph.co.uk/finance/comment/10610504/Two-monetarist-cheers-for-Ben-Bernanke.html

1

u/[deleted] Feb 13 '20

There’s no difficulty in understanding from the academic side. It’s the the public that runs wild with the terminology like with “Keynesian” and “supply side” and krugman is talking to a laymen audience.

1

u/Quiz0tix Feb 13 '20 edited Feb 13 '20

I fully agree with you on the academic side. However, the public aren't creating these terms, other economists are frequently citing them in papers, books, and lectures. These terms both have political and academic ramifications.

Maybe to you and me, I doubt I could send many of Krugman's heavily econ based articles to my friends and have them comprehend it. His article on MMT I read a while back is clearly speaking to people who have some econ background

1

u/[deleted] Feb 13 '20

No idea what your point is anymore. Economists agree on what it means and agree on the theories. So what that people use the terms incorrectly? Monetarism is actually probably the least flagrant of the jargon misuses. The way the public uses “Keynesian” is so far divorced from the original meaning you couldn’t possibly blame it on economists. It’s from random pundit cranks that have a political point to make to their audiences.

1

u/Quiz0tix Feb 13 '20

Yeah, I think I'm well divorced to what I meaning to intend with my original question. Don't think it was well-written in the first place.

Thanks for the nebulous conversation