The History of Recent Macroeconomics Through the Lens of the Marshall-Walras Divide

Michel De Vroey

No 2018018, LIDAM Discussion Papers IRES from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: According to Leijonhufvud, the development of economic theory can be compared to a decision tree, the branches of which originate in choices made about basic methodological nodes. My paper is an attempt at putting this insight into practice by reconstructing the recent history of macroeconomics on its basis. To this end, I examine whether the decision-tree framework can explain three crucial turns in the history of the field: (a) the transition from Keynesian to new classical macroeconomics triggered by Lucas; (b) the transition from the Lucas model to Kydland and Prescott’s ‘real business cycle’ modeling strategy; and (c) the transition from RBC modeling to DSGE modeling.

Keywords: Marshall; Walras; Keynes; Lucas; RBC model; New Keynesian model (search for similar items in EconPapers)
JEL-codes: B22 E E12 E30 (search for similar items in EconPapers)
Date: 2018-11
New Economics Papers: this item is included in nep-dge, nep-his, nep-hpe, nep-mac and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:2018018

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