As Tobin once quiped (I quote from memory) :” Monetarism is about an unidentiable quantity that cannot be controlled”. The co-movement of some money/liquidity aggregate and inflation in very high or hyper-inflation episodes is no proof of “monetarism”. /2
Structural changes in the system, facilitating the creation of inside liquidity destroyed any possible stable relation of “money” and nominal GDP, as well as the possibility of control that never really existed. Broad money is basically endogenous. /3
Phillips curves do not necessarily imply the use of output gap as the indicator of slack. In thick modelling many other indicator are used. Likewise, in relation to an unidentifiable concept of “NARU” (or “NAIRU”). I don’t belief in it (see @farmerrf nber.org/papers/w19267.… or /4
or take to its ultimate logical conclusion the analysis in @ojblanchard1 nber.org/papers/w24057.… . A quote I have used: “ecb.europa.eu/press/key/date… “Solow once quipped “a natural rate that wanders permanently is not natural, is epiphenomenal”
