When was The General Theory of Employment Interest and Money released by John Maynard Keynes?
John Maynard Keynes released The General Theory of Employment, Interest and Money in February 1936. This book caused a profound shift in economic thought.
Questions about The General Theory of Employment, Interest and Money
Short answers, pulled from the story.
What specific economic concepts did Chapter 8 introduce regarding income and consumption in The General Theory of Employment Interest and Money?
Chapter 8 introduced the propensity to consume as a function of income Y where saving equals income minus consumption C(Y). Keynes regarded interest rates as complex and uncertain parameters within this framework.
How did Richard Kahn contribute to the multiplier mechanism described in The General Theory of Employment Interest and Money?
Richard Kahn introduced a similar mechanism in 1931 involving infinite series transactions that influenced Keynes work. If the marginal propensity to consume is 90% then k equals 10 and total employment from public works becomes ten times the initial jobs created.
Which economists helped develop ideas for The General Theory of Employment Interest and Money before its publication?
Keynes drew significant help from students during his progress from the Treatise on Money including members of the Cambridge Circus discussion group. Austin and Joan Robinson forwarded comments to Keynes while Roy Harrod also provided feedback during drafts submitted between 1934 and 1935.
Why was The General Theory of Employment Interest and Money considered difficult to read by many early economists?
Many economists found the book difficult to read during its early years because Étienne Mantoux called it obscure and Frank Knight deemed it hard to follow. Michel DeVroey noted many passages were almost indecipherable while Paul Samuelson called the analysis unpalatable and incomprehensible.
What modern economic consensus emerged regarding The General Theory of Employment Interest and Money after the 2007 financial crises?
The majority new consensus view before 2007 financial crises was New Keynesian economics which accepts neoclassical concept of long-run equilibrium but allows aggregate demand role. Modern macroeconomics continues to center ideas introduced by The General Theory today as almost 400 universities now teach a revised curriculum taking instability seriously.