On the Futility and Hazards of Monetary Heroics

Ekonomisk Debatt Issue 4/2017

31 Pages Posted: 28 Feb 2017 Last revised: 3 Sep 2017

See all articles by Amar Bhide

Amar Bhide

Tufts University - The Fletcher School of Law and Diplomacy

Date Written: February 27, 2017

Abstract

The decentralized enterprise that sustains the dynamism of economies makes top-down monetary interventions, such as quantitative easing, that target aggregates such as overall inflation, futile. Moreover, economic stability and dynamism also require prudent, decentralized lending to decentralized borrowers. But, sustained monetary interventions aimed at aggregate inflation (or employment) targets induce imprudent credit extension, jeopardizing stability and dynamism.

Keywords: innovation, monetary policy, decentralization, quantitative easing

JEL Classification: E5, N20, O33

Suggested Citation

Bhide, Amar, On the Futility and Hazards of Monetary Heroics (February 27, 2017). Ekonomisk Debatt Issue 4/2017. Available at SSRN: https://ssrn.com/abstract=2924514

Amar Bhide (Contact Author)

Tufts University - The Fletcher School of Law and Diplomacy ( email )

Cabot 505
160 Packard Avenue
Medford, MA 02155
United States
617-229-5050 (Phone)

HOME PAGE: http://www.bhide.net

Register to save articles to
your library

Register

Paper statistics

Downloads
55
Abstract Views
508
rank
378,932
PlumX Metrics