How Resilient is the Modern Monetary Theory? A Scientific Confrontation against Selected Fundamental Statements of Macroeconomic Theories

Inhaltsverzeichnis (Table of Contents)

• 1. INTRODUCTION
• 2. IMPORTANT CORNERSTONES OF MODERN MONETARY THEORY
• 2.1 ORIGINS OF MMT
• 2.1.1 CHARTALISM
• 2.1.2 FUNCTIONAL FINANCE
• 2.1.3 THE KALECKIAN - MODEL
• 2.2 EXPLANATION OF KEY FEATURES
• 2.2.1 CURRENCY ISSUERS VS. CURRENCY USERS
• 2.2.2 THE HOUSEHOLD FALLACY
• 2.2.3 THE FEDERAL JOB GUARANTEE
• 3. OVERVIEW OF THE CURRENT SCIENTIFIC CONTROVERSY
• 4. POLITICAL RELEVANCE
• 5. APPLIED METHOD OF RESEARCH: THE QUALITATIVE CONTENT ANALYSIS
• 5.1 PREPARATION OF DATA
• 5.2 ORGANIZATION OF DATA
• 5.3 REPORTING OF RESULTS
• 6. COMPARISON BETWEEN MMT AND OTHER MACROECONOMIC THEORIES
• 6.1 MONEY
• 6.1.1 PURPOSE OF MONEY
• 6.1.2 SUPPLY OF MONEY
• 6.1.3 DEMAND FOR MONEY
• 6.2 DEBT
• 6.2.1 DOMESTIC CURRENCY DEBT
• 6.2.2 FOREIGN CURRENCY DEBT
• 6.3 INFLATION
• 6.3.1 GENERAL INFLATION
• 6.3.2 HYPERINFLATION
• 6.3.3 STAGFLATION
• 6.4 INTEREST RATES
• 6.4.1 GENERAL INTEREST RATES
• 6.4.2 NATURAL INTEREST RATES
• 6.4.3 CROWDING - OUT
• 6.5 TAXATION
• 6.6 UNEMPLOYMENT
• 6.6.1 CYCLICAL UNEMPLOYMENT
• 6.6.2 NATURAL UNEMPLOYMENT
• 6.6.2.1 FRICTIONAL UNEMPLOYMENT
• 6.6.2.2 STRUCTURAL UNEMPLOYMENT
• 7. CONCLUSION
• 8. CASE STUDY: MMT IN LATIN AMERICA
• 9. OUTLOOK

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This Master's thesis aims to analyze the resilience of Modern Monetary Theory (MMT) by critically comparing its core principles to established macroeconomic theories. The study examines the theoretical foundations of MMT, explores the current scientific debate surrounding it, and analyzes its practical implications. Key themes addressed in this work include:

• The origins and key features of MMT, including its theoretical underpinnings in Chartalism, Functional Finance, and the Kaleckian model.
• A critical comparison of MMT's propositions to conventional macroeconomic frameworks, focusing on aspects like money, debt, inflation, interest rates, taxation, and unemployment.
• An assessment of the political relevance and potential implications of adopting MMT policies.
• An exploration of the ongoing scientific controversy surrounding MMT and its critiques from diverse economic perspectives.
• The practical application of MMT principles through a case study focusing on Latin America.

Zusammenfassung der Kapitel (Chapter Summaries)

• Chapter 1: Introduction provides a brief overview of the research topic and its significance. It highlights the increasing relevance of MMT in contemporary economic discussions and outlines the objectives of the thesis.
• Chapter 2: Important Cornerstones of Modern Monetary Theory examines the origins and fundamental tenets of MMT. It explores its theoretical roots in Chartalism, Functional Finance, and the Kaleckian model, and delves into key features such as the distinction between currency issuers and currency users, the "household fallacy," and the concept of a Federal Job Guarantee.
• Chapter 3: Overview of the Current Scientific Controversy analyzes the ongoing debate surrounding MMT, highlighting its strengths, weaknesses, and critiques from diverse economic perspectives. It examines the existing literature and research on MMT, presenting a balanced overview of the current state of knowledge.
• Chapter 4: Political Relevance discusses the political implications of adopting MMT policies. It explores the potential benefits and drawbacks of MMT from a political standpoint, considering its impact on fiscal policy, monetary policy, and government debt management.
• Chapter 5: Applied Method of Research: The Qualitative Content Analysis outlines the methodology employed in the thesis. It describes the data collection and analysis procedures, emphasizing the use of qualitative content analysis to critically evaluate MMT's claims and propositions.
• Chapter 6: Comparison between MMT and Other Macroeconomic Theories constitutes the heart of the research, offering a detailed comparison of MMT's propositions to established macroeconomic theories. This chapter examines MMT's perspectives on money, debt, inflation, interest rates, taxation, and unemployment, contrasting them with conventional economic models.

Schlüsselwörter (Keywords)

The research focuses on Modern Monetary Theory (MMT), examining its origins, core concepts, and critiques. Key themes include Chartalism, Functional Finance, the Kaleckian model, currency issuance, sovereign debt, inflation, interest rates, taxation, unemployment, and the role of government in a modern economy. This study draws on diverse macroeconomic theories and applies qualitative content analysis to critically evaluate MMT's propositions.