Verglüht der Stern der Modern Monetary Theory?

Abstract

Abstract The paper provides a critical analysis of Modern Monetary Theory (MMT). Facing the current macroeconomic problems of supply shocks caused by the Corona pandemic and the war in the Ukraine and its consequences on inflation, the authors ask whether the MMT could seriously influence macroeconomic policymaking. Based on a brief analysis of the historical roots of MMT, the authors show substantial economic problems with this theory. Especially the non-consideration of inflation issues, the inadequacy of tax policy, the problems of open economies, and the neglected problems of the New Political Economy increase the doubts about the suitability of the MMT for overcoming the current economic challenges.