Abstract: The core idea of the modern monetary theory is that the government with sovereign currency will not face financial constraints,and the fiscal deficit is equal to the surplus of the non-government sector.Its policy suggestion is to expand government expenditure and implement employment guarantee schemes when there are idle resources.The essence of the modern monetary theory is that additional issuance of currency can obtain value directly.In most countries,the condition of increasing the value of currency is that the currency directly to the private sectors can promote production and consumption,and the currency advanced by the government for long-term investment can promote short-cycle production.The application of the modern monetary theory in China needs to choose the government expenditure plan according to the actual conditions,and the alternative path is to build a new socialist countryside and optimize the spatial distribution of production.

Key words: modern monetary theory, additional issuance of currency, employment guarantee schemes, economic growth