Download e-book for kindle: The Keynesian Revolution by Lawrence R. Klein (auth.)

By Lawrence R. Klein (auth.)

ISBN-10: 0333018508

ISBN-13: 9780333018507

ISBN-10: 1349163198

ISBN-13: 9781349163199

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We shall at- 44 THE KEYNESIAN REVOLUTION tempt to present a cross-section of opinion in order to bring out the prevailing doctrines. Just as Malthus engaged in a long controversy with the orthodox, classical school over the question of Say's Law (that supply creates its own demand), Keynes pictured himself as arguing the same issue with his orthodox contemporaries. While we shall probably never know how much stimulation Keynes received from many of his anticipators, we can be quite sure that he drew much from Malthus.

As a result of this theoretical system, Keynes proposed a program of reduction of the long-term interest rates and of restoration of confidence to borrowers and lenders. In spite of his restrictive theoretical system, Keynes also proposed a program of government construction. An important scientific contribution was made, at this time, that was to develop a completely revolutionary mode of economic thought. Hayek, Robertson and others were discussing such questions as: Are Mr. Keynes' "fundamental equations" really different from the ordinary quantity equations?

These proposals sound very much like those of the modern Keynesians arguing on the basis of the General Theory. In addition to the attack on thrift, Keynes soon changed some of his previous views on another classical doctrine. He suddenly decided that perhaps free trade does not pay in a period of serious unemployment, and made strong "buy British" arguments. He suggested that the Chancellor of the Exchequer choose,a protective tariff for Great Britain in order simultaneously to relieve the budget and restore confidence.

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The Keynesian Revolution by Lawrence R. Klein (auth.)

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