Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/277265 
Authors: 
Year of Publication: 
2013
Citation: 
[Journal:] European Journal of Economics and Economic Policies: Intervention (EJEEP) [ISSN:] 2052-7772 [Volume:] 10 [Issue:] 2 [Year:] 2013 [Pages:] 136-157
Publisher: 
Edward Elgar Publishing, Cheltenham
Abstract: 
Once every several decades, the private sector loses its mind in a bubble, leverages itself up to the hilt, and is forced into debt minimization in order to remove its debt overhang following the crash. When the private sector as a whole is deleveraging, even at record low interest rates, monetary policy is largely ineffective while fiscal policy becomes absolutely essential in keeping both the economy and money supply from shrinking. The superior effectiveness of monetary policy during private sector profit maximization and of fiscal policy during private sector debt minimization indicates that the latter was the long-overlooked 'other half' of macroeconomics.
Subjects: 
other half' of macroeconomics
Yin and Yang economic cycles
micro-foundation of macroeconomics
unborrowed savings
dual problem of economics
debt minimization
balance sheet recession
JEL: 
D21
E32
E51
E62
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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