The General Theory and the ‘Facts of Experience’

Geoff Tily

Chapter 11 in Keynes’s General Theory, the Rate of Interest and ‘Keynesian’ Economics, 2007, pp 291-311 from Palgrave Macmillan

Abstract: Abstract Neglecting Keynes’s warnings on the opening page of the General Theory proper, Modigliani, Samuelson and Solow fostered a return to the classical theory: I have called this book the General Theory of Employment, Interest and Money, placing the emphasis on the prefix general. The object of such a title is to contrast the character of my arguments and conclusions with those of the classical theory of the subject, upon which I was brought up and which dominates the economic thought, both practical and theoretical, of the governing and academic classes of this generation, as it has for a hundred years past. I shall argue that the postulates of the classical theory are applicable to a special case only and not to the general case, the situation which it assumes being a limiting point of the possible positions of equilibrium. Moreover, the characteristics of the special case assumed by the classical theory happen not to be those of the economic society in which we actually live, with the result that its teaching is misleading and disastrous if we attempt to apply it to the facts of experience. (CW VII, p. 3)

Keywords: Interest Rate; Monetary Policy; Real Interest Rate; Short Rate; Animal Spirit (search for similar items in EconPapers)
Date: 2007
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:pal:palchp:978-0-230-80137-0_11

Ordering information: This item can be ordered from
http://www.palgrave.com/9780230801370

DOI: 10.1057/9780230801370_11

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().