More on helicopter money, prompted by Simon Wren Lewis’ post, and exchanges with Eric Lonnergan and others in the comments appended to my last post on this.
First, responding to Simon. He says that I argue “that if the central bank assumes money is irredeemable, and starts printing a lot of it, people may stop wanting to use it. If they do that, it will no longer be seen as wealth.” Simon remarks: “This is real angels and pins stuff that can come from taking microfoundations too seriously.”
Most people won’t click through to my post, and if you read that paragraph, you would not get why I wrote the post, or what I think about helicopter drops and why. The message is: ‘Tony, taking a too-literal reading of the wrong microfounded model, decides helicopter drops won’t work, so don’t take him seriously.’
I’m against helicopter drops. That bit…
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