Abstract

HIDALGO, Esteban Cruz; PRECIADO, José Francisco Rangel; ESPINOSA, Eduardo Garzón  and  MORUNO, Francisco Manuel Parejo. Lessons from the Great Recession for a Post-Pandemic Economy: The Limits of Monetary Policy. Revista Crítica de Ciências Sociais [online]. 2022, n.127, pp.25-46.  Epub May 30, 2022. ISSN 2182-7435.  https://doi.org/10.4000/rccs.12803.

In this paper we present a response mechanism to the COVID-19 pandemic consistent with the previous empirical literature that emerged during the Great Recession, although not with the underlying ontology. Therefore, we analyze the principle of the endogeneity of money and argue how the proposed mechanism, the Guaranteed Employment, is an institutional and functional solution that allows for overcoming the limitations of the mechanisms used during the Great Recession. This is a further step towards closer coordination between the Central Bank and the Treasury, which has certainly proven essential for financial stability since the international financial crisis of 2007-2008, and which must also encompass macroeconomic stability to cope with the current and future challenges we face as a society: today it is the pandemic, but tomorrow it will be climate change.

Keywords : automatic economy stabilizer; endogenous money; fiscal policy; job guarantee; zero lower bound.

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