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Helicopter money: what is it and what does it do?

Reis, Ricardo and Tenreyro, Silvana ORCID: 0000-0002-9816-7452 (2022) Helicopter money: what is it and what does it do? Annual Review of Economics, 14 (1). 313 - 335. ISSN 1941-1383

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Identification Number: 10.1146/annurev-economics-051420-020618


We review the different meanings of helicopter money, both in the literature and in the public debate around it, and we clarify the conditions under which helicopter money can have an impact on real activity. To do so, we set out a simple model that encapsulates a number of potential channels of policy transmission. The model provides a taxonomy of possibilities for helicopter money to affect the economy, as well as a benchmark set of conditions under which helicopter money is neutral. We use the model to analyze and discuss the impact that helicopter drops might have in response to a number of economic shocks, including a financial crisis, a fiscal crisis, and a pandemic.Expected final online publication date for the Annual Review of Economics, Volume 14 is August 2022. Please see for revised estimates.

Item Type: Article
Official URL:
Additional Information: © 2022 Annual Reviews
Divisions: Economics
Subjects: H Social Sciences > HB Economic Theory
JEL classification: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy (Targets, Instruments, and Effects)
E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy Formation, Macroeconomic Aspects of Public Finance, Macroeconomic Policy, and General Outlook > E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization
E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations; Cycles
Date Deposited: 05 Apr 2022 15:42
Last Modified: 09 Jun 2022 14:36

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