Academic literature on the topic 'Keynes, John Maynard (1883-1946) – ˜The œgeneral theory of employment, interest and money'

“The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back”. John Maynard Keynes (1883-1946) The General Theory of Employment, Interest and Money, ch. 24 (1936)

Nicholas Barbon (1640–1698) is little appreciated by most historians of economic thought. He is sporadically mentioned in a few writings—probably the most well-known being the favorable reference to him made by John Maynard Keynes (1883–1946) in The General Theory of Employment, Interest, and Money (Keynes 1936, p. 359). The fullest treatment of Barbon's economic ideas is contained in The Origin of Scientific Economics: English Economic Thought 1660–1776 by William Louis Letwin (Letwin 1963, pp. 48–75). Letwin considers a major defect of Barbon's first purely scientific inquiry into economics, A Discourse of Trade (Barbon 1690), and by implication, his other economic writings, to be “the logical incoherence of its parts” (Letwin 1963, p. 57). This criticism is not surprising in light of the pre-paradigm period in which Barbon was writing.

Le modèle du marché concurrentiel existe dans deux versions, qui se distinguent par le mode de coordination des plans de production et de consommation (les activités) retenu : une version walrasienne (pré-coordination) et une version marshallienne (post-coordination). Les synthèses néo-classiques se sont efforcées d'intégrer l'analyse de Keynes dans un modèle de pré-coordination des activités. A l'examen, la théorie générale décrit une économie fonctionnant sur un mode de coordination marshallien. On peut en effet démontrer que le modèle de la demande effective (ou modèle z-d-e) s'obtient par dérivation rigoureuse du modèle du marché de Marshall. Cette démarche implique que les relations entre les fonctions keynésiennes de dépense et les fonctions marshalliennes de demande soient clairement établies. Il résulte du mode de coordination choisi que l'économie de Keynes est par construction une économie monétaire. Keynes ayant cependant omis d'insérer l'indispensable système bancaire dans le modèle de la théorie générale, son modèle d'une économie de post-coordination des activités est inachevé. Le mode de coordination des activités n'en demeure pas moins un critère de démarcation satisfaisant des modèles usuels de l'analyse économique, critère dont Keynes a fait usage dans le volume 29 des collected writings
The model of the competitive market exists in two versions which differ depending on the manner in which production plans and consumption plans (activities) are coordinated: a walrasian version (pre-coordination) and a marshallian version (post-coordination). Neo-classical synteses sought to integrate keynesian analysis in a model where activities were pre-coordinated. On examination, it is evident that the general theory describes an economy functioning according to Marshall's approach to coordination. It can in fact be demonstrated that the model of "effective demand" (or z-d-e model) is strictly derived from marshall's model of the market. In order to show this, the relationships between the keynesian expenditure functions and the marshallian demand functions have to be clearly established. The coordination approach selected implies that in its construction the keynesian economy is a monetary economy. Keynes, however, having omitted to incorporate the indispensable banking system in the model of the general theory, his model of an economy where activities are post-coordinated is incomplete. The approach to coordinating activities is nonetheless a satisfactory demarcation criterion for customary models of economic analysis, and is a criterion used by Keynes himself in volume 29 of his collected writings

We first demonstrate the importance of the doctrines of the quantity theory and the long-period stationary state in the formulation of Marshall's, Wicksell's, and Keynes' pre-General Theory monetary theories. We analyze the anomalous events characterized by these writers as short-period phenomena. From the perspective built up around the quantity equation and its long-period context, business cycles represent economic convolutions in which the behavioral mechanisms of the long-period break down. We demonstrate the theoretical breakdown; importantly, it is not reflected in the work of these writers that they understood that their explanations of short-period events undermined the long-period theorizing they carefully built. Second, it is argued that Keynes saw the General Theory as a theory of the short-period in contrast to the long-period monetary frameworks. We use the General Theory's criticisms of classical monetary theory to establish this point.