Keynesianism vs. Neoliberalism: A Data-Driven Comparative Analysis of Macroeconomic Performance Under Competing Policy Regimes in the United States, 1945–2024

This paper conducts a comprehensive empirical evaluation of macroeconomic outcomes under two competing policy paradigms that have governed the United States since the end of World War II: the Keynesian-inflected New Deal Order (1946–1980), rooted in John Maynard Keynes’s theory of aggregate demand management, and the Neoliberal Order (1981–2024), shaped by the price mechanism epistemics of Friedrich A. Hayek and the monetarist counter-revolution of Milton Friedman. Drawing on the historiographical frameworks we operationalize the 1981 policy transition as a natural experiment and apply a fourteen-component analytical pipeline to an annual panel of fifteen Federal Reserve Economic Data (FRED) series spanning 1946–2024. Our methods include: Pruned Exact Linear Time (PELT) structural break detection; normality-adaptive hypothesis testing with Cohen’s d effect sizes; Principal Component Analysis (PCA); a gradient-boosted XGBoost classifier with SHAP interpretability; static and rolling Phillips curve estimation; bootstrapped fiscal multiplier analysis using the corrected Federal Surplus/Deficit ratio; Composite Macroeconomic Performance Index (CMPI) construction; Pearson correlation structure comparison; regime-stratified Okun’s Law analysis; real federal fund rate and yield curve decomposition; M2 velocity and monetary transmission analysis; k -means sub-period temporal clustering; and government debt trajectory with decade-level performance benchmarking. The Keynesian era produced significantly higher mean real GDP growth (3.7% vs. 2.7%), lower structural unemployment (5.0% vs. 6.2%), and a functioning Phillips curve trade-off that collapsed entirely under neoliberalism ( β ^ ≈ 0 , p = 0.94 ). The real federal fund rate averaged negative under the Keynesian regime and turned persistently positive after the Volcker shock. M2 velocity declined sharply in the neoliberal era, refuting the stable quantity theory link central to monetarist policy prescriptions. Temporal clustering recovers five distinct macroeconomic epochs that only partially align with the 1981 historiographical boundary, revealing substantial heterogeneity within each broad regime. The Reagan-era debt expansion, made visible by the corrected debt/GDP trajectory, constitutes a striking empirical contradiction to neoliberal fiscal rhetoric. Together, these results support the interpretation that the two policy regimes represent genuinely distinct macroeconomic equilibria with persistent and measurable consequences for growth, employment, price stability, monetary transmission, and fiscal sustainability. A battery of robustness checks addressing confounding structural shocks, alternative regime boundaries, policy endogeneity, model complexity, and index-construction sensitivity confirms that the core findings are not artifacts of the 1981 periodization, and a cluster-validity analysis formally supports a five-epoch, rather than strictly binary, characterization of the postwar policy landscape.