Beschreibung
The present economics crisis – the worst since the Great Depression – has already been changing the rules for macroeconomic policies. Only a few months ago leading economic policy institutions had advocated laissez faire policies and regarded inflation targeting as the ‘golden rule’ for monetary policy. Today the same think tanks recommend recapitalization of banks, non-conventional monetary policies and counter-cyclical fiscal policies. The theoretical basis for mainstream economic policy is the New Neoclassical Synthesis or the New Consensus Model (NCM), which is based on utility maximising representative agents with rational expectations in a dynamic stochastic general equilibrium (DSGE) approach. Keynesian and Post-Keynesian authors have long been critical with this modelling strategy and its policy implications. As has become clear by now, the NCM model is completely inappropriate to deal with the present global financial and real economic crisis. What are the consequences for economic theory and economic policies? Will the mainstream view on the economy survive – with only minor reforms? Is there any potential within mainstream economics which will transform the “free market view” and the economic policy implications? Since the present situation obviously is an opportunity for Post-Keynesian and other heterodox approaches, are these schools well equipped and ready to tackle the present problems? And how can they have an impact, both on economic policies and on the future development of macroeconomics? The chapters in this book address these questions from different angles.
Content
Introduction
Eckhard Hein, Torsten Niechoj and Engelbert Stockhammer
Microfoundations?
John E. King
How did macro theory get so far off track, and what can heterodox macroeconomists do to get it back on track?
David Colander
Towards a post-Keynesian consensus in macroeconomics: Reconciling the Cambridge and Wall Street views
Marc Lavoie
Explaining European unemployment with a New Keynesian New Growth model
Ansgar Rannenberg
Behavioural Macroeconomics and the New Keynesian model
Jan-Oliver Menz
New Consensus Macroeconomics and Keynesian critique
Philip Arestis
Whither New Consensus Macroeconomics? The role of government and fiscal policy in modern macroeconomics
Giuseppe Fontana
Fiscal policy on shaky foundations: Post Keynesian and Chartalist insights for New Consensus economists
Pavlina Tcherneva
Money and finance: The heterodox views of Robert Clower, Axel Leijonhufvud and Hyman Minsky
Elisabetta De Antoni
Systemic crisis, systemic risk and the financial instability hypothesis
Fernando J. Cardim de Carvalho
Money manager capitalism and the global financial crisis
L. Randall Wray
Diversity of capitalism and macroeconomic policy
Bruno Amable
Variety of economic judgement and monetary policy-making by committee
Sheila Dow, Matthias Klaes and Alberto Montagnoli
The continuing muddles of monetary theory: A steadfast refusal to face facts
Charles A.E. Goodhart
After the bust: The outlook for macroeconomics and macroeconomic policy
Thomas I. Palley
