The new monetary policy: reimagining demand management and price stability in the 21st century
In partnership with Our Money US, researcher Nathan Tankus’ new report for Public Money Action provides a Modern Monetary Theory (MMT) framework for understanding and conducting monetary policy and financial regulation. As part of his wider theory of “non-fiscal payfors,” Tankus opens a more sophisticated, mission-oriented approach to public budgeting that overcomes intransigent debates about the supposed roles of fiscal, monetary, and regulatory policy.
In this report, Public Money Action’s (PMA) debut publication, researcher Nathan Tankus argues that we not only need tools for a new era, but a new way of looking at the role of non-fiscal policy in budgeting, with mission-oriented financial regulation at the core of the new approach. This means turning away from interest rate management and instead toward financial regulation as a direct, more sophisticated toolkit for managing the demand-driven aspects of price stability in the context of broader macroeconomic policy goals, including an equitable and sustainable recovery from the pandemic-depression and a green economic transition to respond to climate change.