Keynesianism

Australian Journal of Politics & History, 2010

European Journal of Political Economy, 2008

While it is clear that Keynes' General Theory of Employment, Interest and Money (1936) has influenced macroeconomic theory, the extent to which his ideas about countercyclical stabilization have altered the course of public policy remains an open question. We develop a dynamic spatial voting model that allows the estimation of a counterfactual showing what planned public budgets would have been like over the cycle if Keynesianism (as interpreted by Leijonhufvud and Clower) had not had any impact on the course of public affairs. Comparison of the counterfactual with the estimated process describing ex ante policy choices after 1950 in Canada allows for the quantification of the changes in fiscal policy that can be attributed to the Keynesian revolution.

2012

In a recent article on our Review, prof. Anthony Thirlwall was quoted to have once said to his graduate class: “simple laws make for good economics” (Thirlwall, 2011). That may be true for economic models, but certainly not for policy prescriptions. As it was noted already by Kregel (2011a) among others, or more recently by Lopez (2012), after a rapid surge of Keynesianism in the USA and partly in Europe, in the wake of the financial and economic crisis, the cultural and political debate has now already returned to fiercely opposing it.

2023

2. Living in the Springtime of Conscious Revolt: Scholarship on the social history of Keynesianism 'There is a vast gulf between how people who do have incomes lose touch with how people who don't have incomes get through on a daily basis […] One of the consequences of losing touch with class is we've also lost touch with economic analysis.'-Humphrey McQueen, "A Class Balancing Act" (1999) This chapter asks, cui bono? As was shown in Chapter One, the principal beneficiaries of the economic change were the capitalists. Using secondary sources, the enquiry now moves to consider other beneficiaries of Keynesianism. What is offered is a collation of scholarship that establishes the existence of a consensus historical perspective, one that has been hidden until now. Based on the literature amassed, historians and scholars generally see Keynesian economics and the Keynesian reconstruction in particular with ambivalence. While Keynesianism was beneficial to a large section of the population, especially blue-collar and white-collar workers, there were important groups of people who did not benefit as much or at all or were in fact disadvantaged. The significance of this is that the scholarship unwittingly coheres with the view of Keynesianism set out in Chapter One-that Keynesianism arose within capitalism-and reveals the extent to which other views are unsubstantiated, even without the introduction of a social history specifically concerned with Keynesianism. The chapter is arranged thematically. Reconstruction is discussed before the war because of its historiographical significance. Then follows a consideration of certain groups: trade unions, women, Indigenous peoples, the elderly, children and postwar migrants. It ends with a geographical juxtaposition between the experiences of the cities and the countryside, between Australia and those within the Empire who were footing the bill. The chapter is by no means Chapter Two-Living in the Springtime of Conscious Revolt 2 exhaustive, as the amount of scholarship touching on Keynesianism-knowingly or unknowingly-is insurmountable. Reconstruction Keynesianism There are only a small number of scholars who have considered the social history of Keynesianism. John Murphy in his article "Work in the Time of Plenty" (2005) uses oral history of men who experienced full employment in the mid-1950s. 1 Tom Sheridan's extensive work on the labour history of the war and postwar is similarly aimed at the economics. 2 Sheridan's Division of Labour (1989) demonstrates how industrial relations quickly deteriorated at the end of the war; something that occurred in part because of limited involvement of unions in postwar reconstruction planning. This contradicts one of the earliest accounts of reconstruction. 3 Sheridan also provides an example in the experiences of workers in the stevedoring industry, with its largely casual workforce pitted against increasingly bullish and experimental corporations. 4 By rectifying the general employment environment, Keynesianism exposed other hardships. Janet McCalman writes of full employment: Now with full employment, the causes of poverty that would endure for the next four decades were brought out in sharp relief: old age, infirmity, the loss of a male breadwinner and low wages with too many dependents. The rôle of the casual labour economy was quickly fading in working-class life. 5

Brooklyn Rail, 2017

A critical review of Varoufakis' "Adults in the Room"

The economic origins and sociopolitical impacts of what became known as “Keynesian Economics” have not received substantial attention from economists, political scientists and philosophers about its mode of governance. This study explores the rise and consolidation of Keynesianism as a mode of governance responsible for creating collective forms of power relations in the postwar world, investigating the possible effects of economic ideas once they reach the political arena. Specifically, we apply a “political economy of power” (PEP) framework to understand the emergence of Keynes’s economic theory and its transformation into a policy agenda that had specific consequences in terms of power, governance and regulation of the economy and the population. While Chapters 1 and 2 respectively promote a bibliographical reading of Michel Foucault’s genealogy of power and John Maynard Keynes’s economic, philosophical and political foundations, Chapter 3 introduces a historical investigation based on primary sources and official documents about the absorption and acceptance of the Keynesian economic theory in Postwar’s economic policies. Our Political Economy of Power (PEP) framework developed throughout Chapter 4 deploys a dual-historical approach, combining institutional and genealogical aspects to analyze the transformation of Keynesianism into a policy agenda between the end of the 1930s and beginning of 1970s across Western Europe and the United States. Our conclusions are buttressed by the epistemological and political shift caused by Keynesianism as a political paradigm, or a “governmentality”. The Keynesian mode of governance was successful in bringing economistic principles and economic technicality into life, thus affecting the ways populations are governed. Consequently, technical economic instruments and welfare systems were actually a technical-scientific justification of intervention via a discourse of power that defended stability, economic growth and welfare. Once Keynesianism established itself as a mode of governance we see the rise of a security society in which policies involving full employment, demand management, economic stability and social security point out towards new forms of control and regulation in the shape of a security pact between the state and the population. Parallel to that, we also invite the reader to return to our original intellectuals – Foucault and Keynes – to shed light on the issue of economic activity as a teleological end of human life. By exploring their ethical writings we stress how economics should be reviewed and reconsidered as a means to achieve an ethical end: the good life. Such trajectory, in Foucault’s rationale, becomes a form of self-government in which the individual transforms himself/herself within the economy and understands economic activity as a means of action – rather than an end.

The aim of this paper is to recount the ebbs and flows of Keynesianism over the history of macroeconomics. The bulk of the paper consists of a discussion of the main episodes of the unfolding of macroeconomics (Keynesian macroeconomics, monetarism, new classical macroeconomics, real business cycle models and new neoclassical synthesis models) against the background of a distinction between Keynesianism as a 'moderately conservative' (Keynes's words) vision about the working of the market system and Keyneisanism as a conceptual apparatus. Particular attention is given to the contrast between Keynesian and Lucasian macroeconomics. The paper ends with a few remarks about the impact of the present crisis on the development of macroeconomic theory.

Global Society, 2018

This article addresses the prospects of a "return to Keynes" in terms of Keynes's own philosophy. It shows that Keynes's moral and political philosophy provide little guide to how Keynesian economics might now be achieved. Keynes's gradualist reformism, derived from both Burke and Moore, leaves a gulf between his economic agenda and the means of its implementation, which is widened in attempts to transpose his proposals onto the global political economy of the 21st century. Keynes's faith in elite intuition and enlightened rule are never securely established and are undermined by his own insights into uncertainty. However, the priority of the short-run and Keynes's depictions of organic unity suggest potential if underdeveloped avenues for alternative social choices and policy redirection .

Mann's article makes a large number of brave and substantial claims about Keynes and 'Keynesian reason' in the context of contemporary capitalism and Left politics. But this depth and breadth makes the article problematic as well as significant, for the simple reason that Mann is unable to fully substantiate all of the claims in question. This commentary critically considers one such claim, concerning the relation between Keynes, Keynesianism, and neoliberalism.

Keynesianism has enjoyed a major resurgence since the outbreak of the current global crisis. Among activists and scholars opposed to neoliberalism it is perhaps the single most important alternative to the project of “rethinking Marxism.” In this paper a representative example of contemporary Keynesianism, Paul Davidson’s The Keynes Solution: The Path to Global Economic Prosperity, is subjected to critical examination. Davidson proposes a series of reforms affecting trade relations, the financial sector, and the international financial architecture. I argue that Davidson’s call for a “civilized” global economy is incompatible with his continued acceptance of capitalist social relations. The limits of the “Keynes Solution” point to the continuing theoretical and practical importance of “rethinking Marxism.” (From Rethinking Marxism, Vol. 25, No. 1, Jan 2013 (70-86).)