Some Academic Literature on MMT

By Stephanie Kelton

I presume Alex Little put this together after reading the NY Times piece on Warren Mosler and MMT in which I was (mis)quoted as saying that MMT has no footprint in the academic press.  It’s not an exhaustive list, but you’ll be exhausted by the time you reach the end.

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8 Responses to Some Academic Literature on MMT

  1. Prof. Kelton (et al)

    I was introduced to MMT only last October, by your interview with Harry Shearer, so my viewpoint is that of an outsider, though I’m thoroughly hooked by your macroeconomic and social perspective. Even so, as an old, retired philosophy and humanities prof, I’ve had lots of experience separating good critical thought from popular, repetitious emotional hype. So the question of ‘academic legitimacy’ interests me. I know you want to get these ideas into the mainstream in a way that will influence public opinion, and can therefore change public policy. But which mainstream? So here are a couple of comments.

    First, there seems to be some interesting ‘healthy disagreement’ in the MMT blogosphere about who the audience is, and whether bloggers are preaching to the choir. Some people think it’s not possible to convert the ‘masses’ because they can’t understand this level of economic theorizing. I think I agree, if the ‘masses’ are the 70% of people whom Chomsky says are controlled by media which entertains and manipulates them, rather than stimulates their critical development. But maybe 30% or more of liberally educated people can follow and judge the worth of these ideas – especially when they are clearly expressed in ordinary terms, as they are by you, and Randall Wray, Kervick and Alt. Some small remaining group of citizens are very good thinkers, but maybe not interested in public policy.

    Second, if your ‘list’ here was trying to impress the readers of the NYT article on Mosler, it seems that it was too heavy on a few names (especially yourself, Wray, Tcherveva and Fullwiler, with another 8 or 10 to a lesser degree). How about your associates in other places, like Europe, Asia and South Asia? Not to mention the video lecture series at Columbia on Modern Money and Public Purpose. What could be more academic than that?

    Finally, as you pointed out, most of this discussion is on the Internet. That’s not shameful, so long as the thinking is backed up by serious, academically respectable research. It seems that it is, and the research is apparently growing.

    As an old wannabe academic myself (my career was at the community college level), I think academia ‘sucks.’

    Very good luck with a hugely important work.

    PS, I don’t watch TV, so I don’t get to read your ideas except in occasional blogs. Video is probably the most influential publicity. But occasionally I notice you say you were misquoted, or didn’t get a chance to say what you wanted. I sympathize with that!

  2. charles fasola

    Sir,

    If we are to believe, and I myself am not a believer, that government policy can be influenced by the public, then if indeed, as you state, “maybe 30% or more of liberally educated people can follow and judge the worth of these ideas – especially when they are clearly expressed in ordinary terms…..”, then you might consider these numbers. If less than 60% of eligible voters actually participate in the act, then 30% is 50% of those who participate. If 50% of that group, 15%, can be convinced of the value of MMT’s policy prescriptions, then a swing of only 1% in the favorable direction will have quite an effect. The writings of Dr. S. Jonas in “The 15% Solution” are an example, a fictional discourse which is quite valid.

  3. Andrew Hartman

    Hello NEP owners,

    The “forum” section of this blog is gone. I think it could be very useful. Is it gone because no one was using it? It was used as if it were three separate blog posts, not a forum. People pursued conversations in the comments section instead of starting a thread in the actual forum section. I am pro-forum. What can we do to make one work?

    Andy

    • Stephanie Kelton

      Andrew,

      People seemed to prefer Facebook to the blog? We’ll gladly return it to NEP if there is demand for a Forum.

      • Detroit Dan

        That was a timely inquiry about the “forum” section. I just wanted to discuss something and looked for the forums here, after being pointed in that direction from the “Contact Us” link.

        Anyway, I am wondering about Matt Yglesias’s recent blog post about bank capital. Matt compared bank capital requirements to requirements for a down payment on a home purchase. That sounded reasonable to me, but there was a comment there (at Matt’s blog on Slate) by “Bad Spellar” that caught my eye. (S)he said:

        Capital (banking or otherwise) is not like a down payment. A down payment converts one type of asset (usually cash) into another type of asset (equity in real estate). That second asset is terribly illiquid.

        Capital is held in two types of assets: securities and intangibles. The majority of bank capital is held in liquid securities such as investment grade bonds or treasuries. There are some intangibles such as Value of Business Acquired (VOBA) Deferred Acquisition Costs (DAC) or Goodwill. There are even things like capitalized investments in software. These second types of asset have zero liquidity.

        I’m wondering who is correct. Is bank capital generally liquid (like bonds) or illiquid (like homes)? I tend to agree with Matt Y, but I see that Dan K liked Bad Spellar’s comment, so I think it might be interesting to hear other MMT thoughts on Matt Y’s analogy. It was also referenced in Kevin Drum’s blog

      • Andrew Hartman

        Thanks, I think it was being used poorly. Will check out facebook. Threads started by readers of the blog are preferable. Not sure why it didn’t catch on?

        Andy

  4. Speaking as a person with only a minimum of formal education in economics and a good deal of education in math and science, I am very grateful for the work of these modern money theorists. I had given up trying to understand modern economics before following cookie crumbs starting with viewing Michael Hudson in the doc “Surviving Progress” to his wikipedia bio and to his blog then on to the MMT entry on wikipedia and from there to Bill Mitchell, Warren Mosler and this Website.

    It was after reading Moslers “7 deadly innocent frauds” that it was clear there was more than a little bit of smoke and mirrors going on in mainstream economics, delivered by those who control the mainstream message. The mainstream and policymakers began to look like the great Wizard of Oz in his booth pulling his useless levers etc in an effort to make fools of us. The Emperor with no clothes also came to mind immediately.

    I have to thank Dr Kelton and her collegues for their dedication and tenacity in getting the message about MMT out, because I find that as opposed to the mainstream economic mush in our daily diet, MMT shows us how much simpler our economic reality is, when compared to the standard version with it’s covert aspects designed to make us all feel humble and willing to defer all authority to those appearing capable of understanding what’s going on.

    MMT has a clarity that I think most of the 70% Chomsky speaks of, could understand if they could actually hear the lessons above all the background noise the mainstream puts out. It makes it clear that we can put a steering wheel on the economy and drive it where we want it to go. Once we all realize that the “complexities” of the mainstream mostly arise from arbitrary rules applied to the great benefit of a few at the expense of the many, and not from any underlying scientific law governing the economy, I think the jig will be up for the mainstream.

    • Detroit Dan

      Well said, JohnC. I feel the same way. Challenging the conventional wisdom regarding macroeconomics today is analogous to challenging the concept of the Trinity, or the divine inerrancy of the Bible, in the 1500s.