Modern Monetary Theory (MMT) indicates that unemployment corresponds to a situation in which the non-government desires to hold net financial assets to an extent that is inconsistent with full employment given the government’s fiscal settings. Demand-pull inflation corresponds to the converse situation. In terms of policy, however, non-government net-saving intentions are a moving and unobservable target. Accordingly, Modern Monetary Theorists propose the job guarantee as a more direct and effective policy approach. This has important advantages over neoliberal prescriptions when it comes to delivering desirable employment and inflation outcomes.

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