A comment on â€˜Endogenous money and effective demandâ€™: a revolution or a step backwards?
Steve Keen argues that post-Keynesians have not sufficiently emphasized the revolutionary character of endogenous money for macroeconomic theory, and that this should be done by recognizing that aggregate demand is equal to current or past income plus the change in debt. This equation, attributed in particular to Hyman Minsky, is discussed and questioned, and it is recalled that a similar equation had been proposed by Alfred Eichner. The consequences of bank credit for firms or households are further analysed within the context of the national accounts, and it is shown that one does not need a redefinition of aggregate demand and aggregate supply, in contrast to what is proposed by Keen.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Giancarlo Bertocco, 2013.
"On Keynes's Criticism of the Loanable Funds Theory,"
Review of Political Economy,
Taylor & Francis Journals, vol. 25(2), pages 309-326, April.
- Giancarlo Bertocco, 2009. "On Keynes’s criticism of the Loanable Funds Theory," Economics and Quantitative Methods qf0904, Department of Economics, University of Insubria.
- Giovanni Bernardo & Emanuele Campiglio, 2014. "A simple model of income, aggregate demand and the process of credit creation by private banks," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(3), pages 381-405, August.
- Giovanni Bernardo & Emanuele Campiglio, 2013. "A Simple Model of Income, Aggregate Demand, and the Process of Credit Creation by Private Banks," Economics Working Paper Archive wp_777, Levy Economics Institute.
- Fabian Lindner, 2015. "Does Saving Increase the Supply of Credit? A Critique of Loanable Funds Theory," World Economic Review, World Economics Association, vol. 2015(4), pages 1-1, February.
- Fabian Lindner, 2013. "Does Saving Increase the Supply of Credit? A Critique of Loanable Funds Theory," IMK Working Paper 120-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
- Steve Keen, 2014. "Endogenous money and effective demand," Review of Keynesian Economics, Edward Elgar Publishing, vol. 2(3), pages 271-291, July.
- Robinson, Joan, 1970. "Quantity Theories Old and New," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 2(4), pages 504-512, November.
- Jacques Le Bourva, 1962. "Création de la monnaie et multiplicateur du crédit," Revue Économique, Programme National Persée, vol. 13(1), pages 29-56.
- Davidson, Paul, 1972. "Money and the Real World," Economic Journal, Royal Economic Society, vol. 82(325), pages 101-115, March. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:elg:rokejn:v:2:y:2014:i:3:p321-332. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helen Craven)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.