<p>A quote from &quot;The Optimum Quantity of Money&quot;, a Milton Friedman paper of 1969...</p>
<blockquote>
<p>Let us suppose now that one day a helicopter flies over this community
and drops an additional $1,000 in bills from the sky, which is, of
course, hastily collected by members of the community. Let us suppose
further that everyone is convinced that this is a unique event which
will never be repeated.</p>
</blockquote>
<p>This money drop became known as helicopter money.</p>
<p>The CARES Act (Mar. 27, 2020) allocated 300b USD to the many individuals who have previously filed a tax return with the United States Internal Revenue Service and the checks were for 1200 USD. Smaller payments were also made to individuals who earned more than 75,001 USD per year. The Consolidated Appropriations Act (Dec. 27, 2020) allocated 166b USD for the many individuals who earned less than 75k USD and the checks were for 600 USD. The American Rescue Plan (Mar. 11, 2021) sent 1400 USD checks to many individuals and smaller payments were also made to individuals earning more than 75k USD. Since there was no requirement that individuals be involuntarily unemployed or facing some sort of deprivation, it was very much like helicopter money. The 75k level is sufficiently high and the benefit is reduced only gradually above 75k that perhaps hundreds of millions of people in a country of 330m, received something very much like helicopter money. In other words, the distribution was broad. In some sense it was indiscriminate and not targeted at deprivation. Other aspects of the same legislation were targeted at deprivation but this particular part of the legislation seemed indiscriminate.</p>
<p>I can contrast this with the Canadian pandemic response which seemed to tie benefits to involuntary worker lockdown or the usual eligibility rules for unemployment insurance benefits or deprivation. The usual eligibility rules make involuntary unemployment a requirement for the payment of the benefit. If there is deprivation or loss of income that was involuntary, a benefit does not look as indiscriminate as helicopter money so I would say the Canadian benefits are not helicopter money.</p>
<p>What was the best example of helicopter money as a response to the pandemic of COVID-19 in an OECD country? An OECD country is one of 38 that are similar in that they are democratic, market economies, and generally have high income per capita.</p>
<p>Edit: 1muflon1 correctly points out that helicopter money is considered to be monetary policy. Since the U.S. central bank has spent many months buying more than 100b per month of government bonds which are used to pay for the checks, there is a monetary aspect to the U.S. pandemic response.</p>

CC BY-SA 4.0
2021-12-30T14:01:15.740Z
Helicopter money in economics is understood to be monetary policy. No  country that I know of implemented helicopter money as defined in economics, even though central bank buying government bonds and government using that money for direct *fiscal* transfer is very close to just central bank sending money to people it is not technically helicopter money as understood by Friedman or in economics
1muflon1
CC BY-SA 4.0
2021-12-30T20:55:00.193Z
"*What was the best example of helicopter money*" Can you please define helicopter money or explain how you measure how close something is to this?
Giskard
CC BY-SA 4.0
2021-12-31T03:18:04.787Z
@Giskard an alternative policy that is a better example of helicopter money would be if everybody received the same amount instead of tapering above 75k USD of annual income. A better example uses a higher threshold for the taper. A better example involves undocumented immigrants.
H2ONaCl
CC BY-SA 4.0
2021-12-31T05:59:05.847Z
IMO you should edit your question to include this instead of the Friedman quote, because he does not seem to specify any of this, but merely relies on the fact that the money gets into circulation, no matter through whom.
Giskard
CC BY-SA 4.0
2023-01-03T04:36:39.037Z
@Giskard another better example would be if the Treasury's payments were "financed" without issuing bonds that pay interest and eventually mature.
H2ONaCl
CC BY-SA 4.0
2023-01-03T12:59:52.743Z
IMO you should edit&clarify your question, not post details in the comments.
Giskard
<political-economy>
best examples of helicopter money in response to the COVID-19 pandemic
H2ONaCl
# best examples of helicopter money in response to the COVID-19 pandemic

(Asked by: username_0 on 2021-12-30)

A quote from "The Optimum Quantity of Money", a Milton Friedman paper of 1969...

> Let us suppose now that one day a helicopter flies over this community
> and drops an additional $1,000 in bills from the sky, which is, of
> course, hastily collected by members of the community. Let us suppose
> further that everyone is convinced that this is a unique event which
> will never be repeated.

This money drop became known as helicopter money.

The CARES Act (Mar. 27, 2020) allocated 300b USD to the many individuals who have previously filed a tax return with the United States Internal Revenue Service and the checks were for 1200 USD. Smaller payments were also made to individuals who earned more than 75,001 USD per year. The Consolidated Appropriations Act (Dec. 27, 2020) allocated 166b USD for the many individuals who earned less than 75k USD and the checks were for 600 USD. The American Rescue Plan (Mar. 11, 2021) sent 1400 USD checks to many individuals and smaller payments were also made to individuals earning more than 75k USD. Since there was no requirement that individuals be involuntarily unemployed or facing some sort of deprivation, it was very much like helicopter money. The 75k level is sufficiently high and the benefit is reduced only gradually above 75k that perhaps hundreds of millions of people in a country of 330m, received something very much like helicopter money. In other words, the distribution was broad. In some sense it was indiscriminate and not targeted at deprivation. Other aspects of the same legislation were targeted at deprivation but this particular part of the legislation seemed indiscriminate.

I can contrast this with the Canadian pandemic response which seemed to tie benefits to involuntary worker lockdown or the usual eligibility rules for unemployment insurance benefits or deprivation. The usual eligibility rules make involuntary unemployment a requirement for the payment of the benefit. If there is deprivation or loss of income that was involuntary, a benefit does not look as indiscriminate as helicopter money so I would say the Canadian benefits are not helicopter money.

What was the best example of helicopter money as a response to the pandemic of COVID-19 in an OECD country? An OECD country is one of 38 that are similar in that they are democratic, market economies, and generally have high income per capita.

Edit: username_1 correctly points out that helicopter money is considered to be monetary policy. Since the U.S. central bank has spent many months buying more than 100b per month of government bonds which are used to pay for the checks, there is a monetary aspect to the U.S. pandemic response.

**Tags:** political-economy

> **Comments:**
> **username_1**: Helicopter money in economics is understood to be monetary policy. No  country that I know of implemented helicopter money as defined in economics, even though central bank buying government bonds and government using that money for direct *fiscal* transfer is very close to just central bank sending money to people it is not technically helicopter money as understood by Friedman or in economics  
> **username_2**: "*What was the best example of helicopter money*" Can you please define helicopter money or explain how you measure how close something is to this?  
> **username_0**: @username_2 an alternative policy that is a better example of helicopter money would be if everybody received the same amount instead of tapering above 75k USD of annual income. A better example uses a higher threshold for the taper. A better example involves undocumented immigrants.  
> **username_2**: IMO you should edit your question to include this instead of the Friedman quote, because he does not seem to specify any of this, but merely relies on the fact that the money gets into circulation, no matter through whom.  
> **username_0**: @username_2 another better example would be if the Treasury's payments were "financed" without issuing bonds that pay interest and eventually mature.  
> **username_2**: IMO you should edit&clarify your question, not post details in the comments.  

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## 0 answers

