News:Telangana Chief Minister has suggested RBI to adopt the concept of Helicopter Money to help state governments tide over the current crisis and kickstart economic activity in India.
- Origin: The term Helicopter Money was given by American Economist Milton Friedman in his paper “The Optimum Quantity of Money”.
- Helicopter money: It refers to an unconventional monetary policy tool which is aimed at bringing the economy back on track by printing large sums of money and distributing it to the public.
- Benefits: a) Increase in Demand Growth b) Increase in inflation among others.
- Challenges: a) It may lead to Hyperinflation b) Devaluation of currency among others.