EBOOK Rethinking the Keynesian Revolution:Keynes, Hayek, and the Wicksell Connection

While standard accounts of the 1930s debates surrounding economic thought pit John        Maynard Keynes against Friedrich von Hayek in a clash of ideology, this reflexive        dichotomy is in many respects superficial. It is the argument of this book that both        Keynes and Hayek developed their respective theories of the business cycle within        the tradition of Swedish economist Knut Wicksell, and that this shared genealogy        manifested itself in significant theoretical affinities between the two supposed        antagonists. The salient features of Wicksell's work, namely the importance of        money, the role of uncertainty, coordination failures, and the element of time in        capital accumulation, all motivated the Keynesian and Hayekian theories of economic        fluctuations. They also contributed to a fundamental convergence between the two        economists during the 1930s. This shared, 'Wicksellian' vision of economic problems        points to a very different research agenda from that of the Walrasian-style, general        equilibrium analysis that has dominated postwar macroeconomics.This book will appeal        to economists interested in historical perspective of their discipline, as well as        historians of economic thought. The author not only deconstructs some of the        historical misconceptions of the Keynes versus Hayek debate, but also suggests how        the insights uncovered can inform and instruct modern theory. While much of the        analysis is technical, it does not assume previous knowledge of 1930s economic        theory, and should be accessible to academics and graduate students with general        economics training.