IDEAS home Printed from https://ideas.repec.org/a/taf/revpoe/v25y2013i4p672-678.html
   My bibliography  Save this article

Effective Demand: Securing the Foundations

Author

Listed:
  • Jochen Hartwig

Abstract

This paper is one of three contributions to a symposium commenting on papers previously published by the other authors. I basically agree with Allain's (2009) reconstruction of Keynes's model of effective demand from Chapter 3 of The General Theory , except that I think that entrepreneurs take the overall economic situation into account when forming expectations as to how much demand will be forthcoming to them. I also agree with Hayes (2007a) on the most important--and most controversial--issues surrounding the principle of effective demand. Some disagreement remains on the merits of the 'Swedish' method of comparing ex ante expectations with ex post results and on the 'nature' of the equilibrium represented by the point of effective demand: for Hayes, it is a market equilibrium, while I regard it to be an expectational equilibrium in the minds of entrepreneurs.

Suggested Citation

  • Jochen Hartwig, 2013. "Effective Demand: Securing the Foundations," Review of Political Economy, Taylor & Francis Journals, vol. 25(4), pages 672-678, October.
    • Handle: RePEc:taf:revpoe:v:25:y:2013:i:4:p:672-678
    DOI: 10.1080/09538259.2013.837330
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09538259.2013.837330
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09538259.2013.837330?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Victoria Chick, 1983. "Macroeconomics after Keynes: A Reconsideration of the General Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262530457, December.
    2. Edward J. Amadeo, 1989. "Keynes’s Principle of Effective Demand," Books, Edward Elgar Publishing, number 11.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. M.G. Hayes, 2013. "Effective Demand: Securing the Foundations," Review of Political Economy, Taylor & Francis Journals, vol. 25(4), pages 661-671, October.
    2. Jochen Hartwig, 2017. "The Comparative Statics of Effective Demand," Review of Political Economy, Taylor & Francis Journals, vol. 29(3), pages 360-375, July.
    3. Severin Reissl, 2015. "The return of black box economics - a critique of Keen on effective demand and changes in debt," IMK Working Paper 149-2015, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    4. Hein, Eckhard, 2015. "The principle of effective demand: Marx, Kalecki, Keynes and beyond," IPE Working Papers 60/2015, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    5. Constantinos Repapis, 2020. "Book review: Mark G Hayes, John Maynard Keynes: The Art of Choosing the Right Model," The Economic and Labour Relations Review, , vol. 31(3), pages 470-476, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jochen Hartwig, 2007. "Keynes vs. the Post Keynesians on the Principle of Effective Demand," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 14(4), pages 725-739.
    2. Richard X. Chase, 1994. "The "Fatal Flaw" of Classical Economics: Aspects of Keynes’s Evolution from," Journal of Economic Issues, Taylor & Francis Journals, vol. 28(3), pages 847-875, September.
    3. Luigi L. Pasinetti, 2001. "The Principle of Effective Demand and Its Relevance in the Long Run," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 23(3), pages 383-390, March.
    4. Toshio Watanabe, 2020. "Financial Instability and Effects of Monetary Policy," Bulletin of Political Economy, Bulletin of Political Economy, vol. 14(1), pages 117-145, June.
    5. Jochen Hartwig, 2006. "Explaining the aggregate price level with Keynes's principle of effective demand," Review of Social Economy, Taylor & Francis Journals, vol. 64(4), pages 469-492.
    6. John B. Davis, 2017. "The Continuing Relevance of Keynes's Philosophical Thinking: Reflexivity, Complexity and Uncertainty," Annals of the Fondazione Luigi Einaudi. An Interdisciplinary Journal of Economics, History and Political Science, Fondazione Luigi Einaudi, Torino (Italy), vol. 51(1), pages 55-76, June.
    7. Stephanie Bell, 1999. "Functional Finance: What, Why, and How?," Economics Working Paper Archive wp_287, Levy Economics Institute.
    8. Jochen Hartwig, 2017. "The Comparative Statics of Effective Demand," Review of Political Economy, Taylor & Francis Journals, vol. 29(3), pages 360-375, July.
    9. Jesper Jespersen, 2012. "Keynes’s General Theory after 75 years: time to re-read and reflect," Chapters, in: Jesper Jespersen & Mogens Ove Madsen (ed.), Keynes’s General Theory for Today, chapter 8, pages 131-150, Edward Elgar Publishing.
    10. Angel Asensio, 2010. "Macroeconomic trouble and policy challenges in the wake of the financial bust," Working Papers halshs-00496921, HAL.
    11. Nicola Meccheri, 2007. "Wage behaviour and unemployment in Keynes' and New Keynesians' views: A comparison," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 14(4), pages 701-724.
    12. Earl, Peter E., 2015. "Anchoring in economics: On Frey and Gallus on the aggregation of behavioural anomalies," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 9, pages 1-25.
    13. Jespersen Jesper, 2000. "Some Aspects of J. M. Keynes's Theoretical Contributions to the Economic Debate of the 1920's'," Jahrbuch für Wirtschaftsgeschichte / Economic History Yearbook, De Gruyter, vol. 41(1), pages 219-224, June.
    14. Klausinger, Hansjörg, 2000. "Walras' law and the IS-LM model. A tale of progress and regress," Department of Economics Working Paper Series 69, WU Vienna University of Economics and Business.
    15. Philip Arestis & Malcolm Sawyer, 1997. "Reasserting the Role of Keynesian Policies for the New Millenium," Economics Working Paper Archive wp_207, Levy Economics Institute.
    16. Huang, Wenge & Zhang, Jinsong, 2015. "A New Interpretation of the Mechanism for the Determination of Interest Rate and Its Policy Implications," MPRA Paper 66208, University Library of Munich, Germany.
    17. Heller, Claudia, 2009. "Keynes’s slip of the pen: aggregate supply curve vs employment function," MPRA Paper 12837, University Library of Munich, Germany.
    18. Mark Setterfield & Bill Gibson, 2013. "Real and financial crises: A multi-agent approach," Working Papers 1309, Trinity College, Department of Economics, revised Jul 2014.
    19. James C. W. Ahiakpor, 1997. "Full Employment: A Classical Assumption or Keynes's Rhetorical Device?," Southern Economic Journal, John Wiley & Sons, vol. 64(1), pages 56-74, July.
    20. Sheila C. Dow, 1986. "Post Keynesian Monetary Theory for an Open Economy," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 9(2), pages 237-257, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:revpoe:v:25:y:2013:i:4:p:672-678. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CRPE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.