 Bank credit, financial intermediation and the distribution of national income all matter to macroeconomicsBrett Fiebiger
Review of Keynesian Economics, 2014, vol. 2, issue 3, 292-311 Abstract: The Great Recession has exposed several failings in the mainstream economics profession, including a generalised neglect of the macro role of debt and of banking. Steve Keen has proposed an alternative approach to macroeconomics which he sometimes labels as the 'Walras–Schumpeter–Minsky Law'. His key claim seems to be that – as a consequence of endogenous money – the concepts of effective demand and aggregate supply should be redefined to include the 'change in [private] debt' as well as financial asset transactions. This paper cautions that doing so may generate more confusion than what the redefinitions seek to clarify. Further, while endogenous money is a fact, it is important to recognise the roles of financial intermediation and adverse trends in income distribution in shaping the macro patterns and financing relations that preceded the Great Recession in the United States. Keywords: endogenous finance; endogenous money; nonbank credit; inequality (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:elg:rokejn:v:2:y:2014:i:3:p292-311 Access Statistics for this article Review of Keynesian Economics is currently edited by Thomas Palley, MatÃas Vernengo and Esteban Pérez Caldentey More articles in Review of Keynesian Economics from Edward Elgar Publishing |
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