Monetary discipline

Monetary discipline is a phrase used by some economists when speaking of monetary policy, generally meaning limiting the money supply of an economy in some way. ^{[1] [2] [3]}

Definitions

One definition of monetary discipline is a central bank matching the money supply to the level of production or reserves in an economy. ^[4] This definition holds that money printing should have a relationship to a particular economic equation, rather than being influenced by politics. ^[4]

Another definition is constraining the money supply, limiting inflation, and growing an economy by increasing the velocity of money. ^[5]

Another way of achieving monetary discipline is by keeping a pegged exchange rate, thereby matching a money supply to a foreign currency. ^[6]

References

1. Melitz, Jacques (1987-02-17). "Monetary Discipline, Germany, and the European Monetary System". Rochester, NY. SSRN   884539.{{cite journal}}: Cite journal requires |journal= (help)
2. Neyapti, Bilin; Ozgur, Secil (2007). "The Effects of Fiscal and Monetary Discipline on Budgetary Outcomes" . Contemporary Economic Policy. 25 (2): 146–155. doi:10.1111/j.1465-7287.2007.00034.x. hdl: 11693/23491 . ISSN   1465-7287. S2CID   21667885.
3. Dalmazzo, Alberto (2014). "Monetary Discipline as a Substitute for Fiscal Reforms and Market Liberalisations" . Economic Notes. 43 (3): 193–210. doi:10.1111/ecno.12018. ISSN   1468-0300. S2CID   155078596.
4. "Ways of Controlling Inflation: Recommendations to Zimbabwean Policy Makers". March 7, 2011. Retrieved May 22, 2012.
5. Succo, John (October 11, 2004). "Minyan Mailbag - Money Supply and Real Estate" . Retrieved May 22, 2012.
6. Fielding, David; Bleaney, Michael (2000). "Monetary Discipline and Inflation in Developing Countries: The Role of the Exchange Rate Regime". Oxford Economic Papers. 52 (3): 521–538. doi:10.1093/oep/52.3.521. ISSN   0030-7653. JSTOR   3488640.