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https://doi.org/10.62836/emi.v4i2.349
Liankui Gao, & Mengxuan Gan. (2025). Macroeconomic Regulation: A Third Way beyond Keynesianism and Monetarism. Economics & Management Information, 1–5. https://doi.org/10.62836/emi.v4i2.349
Volume 4, Issue 2, April 2025
Copyright (c) 2025 Liankui Gao, Mengxuan Gan
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Macroeconomic Regulation: A Third Way beyond Keynesianism and Monetarism

In addressing economic downturns, there are two primary approaches in Western macroeconomics: central bank money issuance and government debt issuance. The former is known as monetarism, and the latter is called Keynesianism. In fact, there is a “third path” apart from these two methods, which is to “stimulate the credit-creation ability of commercial banks”. This is a new solution proposed in this paper. “Expanding the credit creation of commercial banks” can also generate a large amount of money for investment without incurring any costs and without leaving any sequelae of economic stimulus.

macroeconomic regulation; third path; paradox of monetary policy; monetary hedging; depression caused by a collapse in the rate of return on capital

References

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Supporting Agencies

  1. Funding: This research received no external funding.