By Scott Fullwiler
I suggested more than three years ago that helicopter drops are fiscal operations (printable version here), in contrast to the more traditional view that they were monetary policy operations (e.g., “Helicopter Ben”). My argument was based almost entirely on accounting and, therefore, on the actual balance sheet effects of a money drop. True helicopter drops of money raise the net financial assets (via income increases) of the non-government sector, which is exactly what fiscal policy does but not what monetary policy does.
