An unexpected turn: Mileinomics reaches for “Keynesian” measures to revive the economy
The government is deepening a strategy to mobilize the dollars and pesos already in the system to spur lending. Experts say it may not be enough La entrada An unexpected turn: Mileinomics reaches for “Keynesian” measures to revive the economy se publicó primero en Buenos Aires Herald .
The Mileinomics administration has announced a series of measures aimed at reviving the Argentine economy, focusing on boosting domestic demand. The government has opened up dollar bank lending to companies, introduced a wage floor of AR$1 million (US$653), and utilized ANSES pension funds to provide banks with liquidity for lower interest rate mortgages.
These measures have been likened to a "Keynesian turn," despite the libertarian administration's rejection of Keynesian policies. While some economists believe the measures will yield a marginal improvement, the economic activity in Argentina has been declining, with a 0.8% month-on-month decrease in July and a flat year-on-year reading.
The investment and consumption data also show a year-on-year flat growth. The measures focus on stimulating demand through credit and income but lack the necessary weight to make a significant difference, according to research firms Vectorial and LCG. The government's underlying problem is that the economy is not growing fast enough, and fiscal adjustment alone is insufficient to generate the required dynamism.
Written by urgent.news from Buenos Aires Herald's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- An unexpected turn: Mileinomics reaches for “Keynesian” measures to revive the economy buenosairesherald.com
