scholarly journals Keynesian System, Keynesian Policies and an Evaluation of What Keynes Might Have Advised Today

2015 ◽  
Author(s):  
Özlen Hiç
Keyword(s):  
Aggregate Demand ◽  
New Keynesian ◽  
Economic Problems ◽  
Keynesian Economics ◽  
The Face

We have surveyed in this article the development of the Keynesian macroeconomic system since 1936 up to the present. Our approach was, however, analytical rather than historical and descriptive. Keynesian System, hence Neo-Keynesians and modern Keynesian schools, such as New Keynesian Economics and Post-Keynesian Economics visualize that, if left by itself, the economy will give unemployment due to insufficiency of aggregate demand. In the article, the Keynesian policies are analysed with respect to their efficiency. Keynesian System was developed and modified in the face of criticisms by its opponents. We emphasize in our article that the Keynesian System was mainstream most of the time both in academic circles and in implementation. Presently again, basically Keynesian System has the upper hand, mostly New Keynesian Economics and also to some extent, Post-Keynesian Economics.The last section of the article covers an evaluation of what Keynes might have said for today’s economic problems.

Theorizing About Post-Keynesian Economics in Australasa

2013 ◽  
pp. 411-435
Author(s):  
Paul Dalziel ◽  
J. W. Nevile
Keyword(s):  
Higher Education ◽  
Economic Growth ◽  
Monetary Policy ◽  
World War Ii ◽  
Fiscal Policy ◽  
Aggregate Demand ◽  
World War ◽  
Keynesian Economics ◽  
Low Levels ◽  
Monetary And Fiscal Policy

There was much in common in the development of post-Keynesian economics in Australia and New Zealand, but there were also many differences. Both countries shared a common heritage in higher education. In the first twenty-five years after World War II, both countries adopted broadly Keynesian policies and experienced very low levels of unemployment. Increasingly over these years more theorizing about macroeconomic policy had what now would be called a post-Keynesian content, but this label was not used till after the event. In both countries, apart from one important factor, the experience of actual monetary policy and theorizing about it were similar. Keynesian ideas were more rapidly adopted in Australia than in many other countries. Not surprisingly for a couple of decades after 1936, analysis of policy and its application was Keynesian rather than post-Keynesian, with fiscal policy playing the major role. The conduct of both monetary and fiscal policy depends on the theory of inflation. This chapter examines post-Keynesian economics in Australasia, focusing on aggregate demand, economic growth, and income distribution policy.

scholarly journals Comparative Political Economy and Varieties of Macroeconomics

2020 ◽  
Author(s):  
Jonas Pontusson ◽  
Lucio Baccaro
Keyword(s):  
Political Economy ◽  
Growth Models ◽  
Aggregate Demand ◽  
Industrial Relations ◽  
Welfare States ◽  
New Keynesian ◽  
Growth Trajectories ◽  
Comparative Political Economy ◽  
Political Economies ◽  
Advanced Capitalist

The comparative study of advanced capitalist political economies emerged as a distinct subfield of political science in the late 1970s. A number of early contributions to this subfield sought to explain cross-national variation of macroeconomic performance, but the subfield increasingly focused its attention on other issues—the consequences of welfare states, industrial relations, and skill formation for innovation, competition, and the distribution of income—in the 15–20 years prior to the global crisis of 2007–2009. The crisis and its aftermath has ushered in renewed interest in macroeconomic management among comparative political economists. As in the past, this theme is linked to that of interdependence among capitalist economies and the room for partisan differences in macroeconomic policy priorities. In addition, recent contributions to comparative political economy distinguish growth models in terms of the role played by different components of aggregate demand and explore the distributive implications of divergent growth trajectories in countries that have traditionally been conceived as belonging to one or another variety of capitalism. With economic growth re-emerging as a central concern in the wake of the crisis, the New Keynesian tradition features prominently in recent efforts to put macroeconomics back into comparative political economy. However, comparative political economists also ought to engage with the Post-Keynesian tradition, which assigns a more important role to policy choices than the New Keynesian tradition. Positing that distributive conflict and power relations are critical to macroeconomic dynamics, the Post-Keynesian tradition provides useful analytical foundations for understanding the political foundations of divergent growth trajectories among advanced capitalist political economies.

Debt, Deleveraging, and the Liquidity Trap: A Fisher-Minsky-Koo Approach*

2012 ◽  
Vol 127 (3) ◽  
pp. 1469-1513 ◽  
Author(s):  
Gauti B. Eggertsson ◽  
Paul Krugman
Keyword(s):  
Fiscal Policy ◽  
Great Depression ◽  
Aggregate Demand ◽  
New Keynesian ◽  
Liquidity Trap ◽  
The Great Depression ◽  
Lost Decade ◽  
Debt Deflation

Abstract In this article we present a simple new Keynesian–style model of debt-driven slumps—that is, situations in which an overhang of debt on the part of some agents, who are forced into rapid deleveraging, is depressing aggregate demand. Making some agents debt-constrained is a surprisingly powerful assumption. Fisherian debt deflation, the possibility of a liquidity trap, the paradox of thrift and toil, a Keynesian-type multiplier, and a rationale for expansionary fiscal policy all emerge naturally from the model. We argue that this approach sheds considerable light both on current economic difficulties and on historical episodes, including Japan’s lost decade (now in its 18th year) and the Great Depression itself.

New-Keynesian economics today

1997 ◽  
Author(s):  
Brian Snowdon ◽  
Howard Vane
Keyword(s):  
New Keynesian ◽  
Keynesian Economics

scholarly journals The Aggregate Implications of Regional Business Cycles

Econometrica ◽  
2019 ◽  
Vol 87 (6) ◽  
pp. 1789-1833 ◽  
Author(s):  
Martin Beraja ◽  
Erik Hurst ◽  
Juan Ospina
Keyword(s):  
Business Cycles ◽  
Great Recession ◽  
Aggregate Demand ◽  
Strong Relationship ◽  
Aggregate Data ◽  
New Keynesian ◽  
Aggregate Fluctuations ◽  
Wage Dynamics ◽  
The Great Recession ◽  
Wage Stickiness

Making inferences about aggregate business cycles from regional variation alone is difficult because of economic channels and shocks that differ between regional and aggregate economies. However, we argue that regional business cycles contain valuable information that can help discipline models of aggregate fluctuations. We begin by documenting a strong relationship across U.S. states between local employment and wage growth during the Great Recession. This relationship is much weaker in U.S. aggregates. Then, we present a methodology that combines such regional and aggregate data in order to estimate a medium‐scale New Keynesian DSGE model. We find that aggregate demand shocks were important drivers of aggregate employment during the Great Recession, but the wage stickiness necessary for them to account for the slow employment recovery and the modest fall in aggregate wages is inconsistent with the flexibility of wages we observe across U.S. states. Finally, we show that our methodology yields different conclusions about the causes of aggregate employment and wage dynamics between 2007 and 2014 than either estimating our model with aggregate data alone or performing back‐of‐the‐envelope calculations that directly extrapolate from well‐identified regional elasticities.

scholarly journals The State of New Keynesian Economics: A Partial Assessment

2018 ◽  
Vol 32 (3) ◽  
pp. 87-112 ◽  
Author(s):  
Jordi Galí
Keyword(s):  
Interest Rates ◽  
Global Financial Crisis ◽  
Academic Research ◽  
The State ◽  
New Keynesian ◽  
Future Research ◽  
New Keynesian Model ◽  
Keynesian Economics ◽  
Keynesian Model ◽  
Dynamic Stochastic

In August 2007, when the first signs emerged of what would come to be the most damaging global financial crisis since the Great Depression, the New Keynesian paradigm was dominant in macroeconomics. Ten years later, tons of ammunition has been fired against modern macroeconomics in general, and against dynamic stochastic general equilibrium models that build on the New Keynesian framework in particular. Those criticisms notwithstanding, the New Keynesian model arguably remains the dominant framework in the classroom, in academic research, and in policy modeling. In fact, one can argue that over the past ten years the scope of New Keynesian economics has kept widening, by encompassing a growing number of phenomena that are analyzed using its basic framework, as well as by addressing some of the criticisms raised against it. The present paper takes stock of the state of New Keynesian economics by reviewing some of its main insights and by providing an overview of some recent developments. In particular, I discuss some recent work on two very active research programs: the implications of the zero lower bound on nominal interest rates and the interaction of monetary policy and household heterogeneity. Finally, I discuss what I view as some of the main shortcomings of the New Keynesian model and possible areas for future research.

scholarly journals The role of taxes as automatic destabilizers in New Keynesian economics

2003 ◽  
Vol 87 (5-6) ◽  
pp. 1123-1136 ◽  
Author(s):  
Henrik Jacobsen Kleven ◽  
Claus Thustrup Kreiner
Keyword(s):  
New Keynesian ◽  
Keynesian Economics

The New Keynesian Economics and the Output-Inflation Trade-Off

1988 ◽  
Vol 1988 (1) ◽  
pp. 1 ◽  
Author(s):  
Laurence Ball ◽  
N. Gregory Mankiw ◽  
David Romer ◽  
George A. Akerlof ◽  
Andrew Rose ◽  
...  
Keyword(s):  
New Keynesian ◽  
Trade Off ◽  
Keynesian Economics
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