This ambitious book seeks both to revive and revise the idea of ‘functional finance'. Followers of this doctrine believe that government budgets should concentrate solely on their macroeconomic impact on the economy, rather than reflecting a concern for sound finance and budgetary discipline....

Most OECD economies have suffered from persistently high unemployment since the mid-1970s as a result of demand deficiencies promoted by inappropriate fiscal and monetary policy. Governments have failed to understand the opportunities that they have as the issuer of the currency. In this paper,...