Palley, Thomas I. - 2016 - Revised January 2016
This paper explores zero lower bound (ZLB) economics. The ZLB is widely invoked to explain stagnation and it fits with … the long tradition that argues Keynesian economics is a special case based on nominal rigidities. The ZLB represents the … newest rigidity. Contrary to ZLB economics, not only does a laissez-faire monetary economy lack a mechanism for delivering …