Fiscal and Monetary Policy

Abstract

Romar Correa continues to use the Godley-Cripps (1983) stock-flow-consistent (SFC) framework in this update to refine the thesis that the monetary authority is the ‘handmaiden’ of the fiscal authority. The bank, commercial and central being indistinguishable, is central to the account. A revitalized ‘real bills doctrine’ is proposed. The deleterious consequences of promoting the alternative, ‘financialization’ are traced.