Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It

Egmont Kakarot-Handtke ()

MPRA Paper from University Library of Munich, Germany

Abstract: Krugman has recently revitalized IS-LM with a number of succinct analytical pieces on his blog. The reverberations were remarkable. Economists, however, are known often not grasp the full content of their own and, a fortiori, of others’ models. This happened to Keynes in the days of high theory and to Krugman in these days. Keynes applied a defect formalism, which is here replaced by objective-structural axioms. This yields the correct relationship between retained profit, saving, and investment which in turn makes it clear after the event that the IS-part of the IS-LM construct never could bear any substantive theoretical load.

Keywords: new framework of concepts; structure-centric; axiom set; Hicks; Allais (search for similar items in EconPapers)
JEL-codes: B59 E12 E13 (search for similar items in EconPapers)
Date: 2014-02-11
New Economics Papers: this item is included in nep-hpe, nep-mac, nep-pke and nep-sog
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/53608/1/MPRA_paper_53608.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:53608

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().