Skip navigation
Time for Helicopter Money?
Article

Time for Helicopter Money?


auto-generated audio
auto-generated audio

Editorial Rating

8

Qualities

  • Innovative

Recommendation

Although interest rates are at all-time lows – even in negative territory in some countries – global growth remains tepid. Kemal Derviş of the Brookings Institution says that it is high time for central bankers to band together and start hiking up interest rates in order to ward off speculation and nip potential bubbles. Along with higher rates, policy makers should implement ways of injecting “helicopter money” into their economies to provide stimulus, build up infrastructure and educate people. getAbstract suggests Derviş’s provocative but topical paper to policy makers, economists and business executives.

Take-Aways

  • All-time low, even negative, interest rates haven’t helped stimulate growth in the advanced economies.
  • Policy makers in these nations should consider fiscal measures that would pump money into their economies to finance infrastructure projects, thereby creating jobs and enhancing productivity.
  • Some economists propose “reverse income policies,” which would mandate pay increases throughout the private sector in an attempt to boost inflationary expectations.

About the Author

Kemal Derviş is vice president and director of global economy and development at the Brookings Institution.