The author thanks two referees for helpful comments and suggestions. This is a revised version of a (refereed) paper written for the 12th Path to Full Employment Conference, Centre for Full Employment and Equity, University of Newcastle, 2–3 December 2010.
Macroeconomic Policy and Abba Lerner’s System of Functional Finance*
Article first published online: 23 MAY 2011
© 2011 The Economic Society of Australia
Economic Papers: A journal of applied economics and policy
Volume 30, Issue 2, pages 208–217, June 2011
How to Cite
Hart, N. (2011), Macroeconomic Policy and Abba Lerner’s System of Functional Finance. Economic Papers: A journal of applied economics and policy, 30: 208–217. doi: 10.1111/j.1759-3441.2011.00117.x
- Issue published online: 23 MAY 2011
- Article first published online: 23 MAY 2011
- fiscal policy;
- functional finance;
- budget deficits
Lerner’s system of functional finance, said to have provided the logical framework for Keynes’s policy, has largely been neglected in the recent literature and policy deliberation. This paper considers the relevance of Lerner’s system and at the same time provides a critique of the opposing “sound finance” doctrine that governs much of the current thinking on macroeconomic policy making in the shadows of the Global Financial Crisis (GFC).