Richmond paper instructs ECB to buy government debt
The European Central Bank (ECB) should buy packages of government debt with weights set according to the relative GDPs of governments, according to a working paper published by the Federal Reserve Bank of Richmond.
The paper – ECB Monetary Policy in the Recession: A New Keynesian (Old Monetarist) Critique, by Robert Hetzel – argues the ECB is, in effect, already conducting fiscal policy through its allocation of seigniorage (the revenue generated by the creation of money) to individual countries
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