Book contents
- Frontmatter
- Contents
- Editorial preface
- List of contributors
- Introduction: Cracks in the neoclassical mirror: on the break-up of a vision
- Part I Class relations in circulation and production
- Part II The Cambridge criticisms
- Part III Microeconomics
- Part IV Macroeconomics
- 8 Keynes's paradigm: a theoretical framework for monetary analysis
- 9 A post-Keynesian development model of the “Keynesian” model
- 10 A simple framework for the analysis of taxation, distribution, and effective demand
- 11 A classical model of business cycles
- Part V International trade
- Part VI Property and welfare
- Part VII Marxism and modern economics
- Epilogue: The hieroglyph of production
8 - Keynes's paradigm: a theoretical framework for monetary analysis
Published online by Cambridge University Press: 19 October 2009
- Frontmatter
- Contents
- Editorial preface
- List of contributors
- Introduction: Cracks in the neoclassical mirror: on the break-up of a vision
- Part I Class relations in circulation and production
- Part II The Cambridge criticisms
- Part III Microeconomics
- Part IV Macroeconomics
- 8 Keynes's paradigm: a theoretical framework for monetary analysis
- 9 A post-Keynesian development model of the “Keynesian” model
- 10 A simple framework for the analysis of taxation, distribution, and effective demand
- 11 A classical model of business cycles
- Part V International trade
- Part VI Property and welfare
- Part VII Marxism and modern economics
- Epilogue: The hieroglyph of production
Summary
The object of our analysis is, not to provide a machine, or method of blind manipulation, which will furnish an infallible answer, but to provide ourselves with an organized and orderly method of thinking out particular problems; and, after we have reached a provisional conclusion by isolating the complicating factors one by one, we then have to go back on ourselves and allow, as well as we can, for the probable interactions of factors amongst themselves. This is the nature of economic thinking. Any other way of applying our formal principles of thought … will lead us into error.
(Keynes, 1936, p. 297)Keynes started his revisions and extensions of his Treatise on Money in the belief that he was continuing his refinement of the theory of money. Instead, on his own admission, he finished by writing an entirely new and original theory of prices, employment, and output as a whole in which it was impossible to dichotomize the monetary and real relations of a modern production economy (Keynes, 1973, Vol. XIII, pp. 408–09).
To me, the most extraordinary thing regarded historically, is the disappearance of the theory of demand and supply for output as a whole, i.e. the theory of employment, after it had been for a quarter of a century the most discussed thing in economics. One of the most important transitions for me, after my Treatise on Money had been published, was suddenly realizing this.
(Keynes, 1973, Vol. XIV, p. 85)- Type
- Chapter
- Information
- Growth, Profits and PropertyEssays in the Revival of Political Economy, pp. 137 - 150Publisher: Cambridge University PressPrint publication year: 1980
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