Keynes and economic crisis: some reconsiderations
In this paper we read Keynes’s General Theory of Employment, Interest and Money from the point of view of the main causes of the economic crisis in general and particularly the present world economic crisis. We compare Keynes’s approach to the crisis with the work of contemporary distinguished economists. We conclude that a drop of marginal efficiency of capital is the main cause of the economic crisis and depression, and that such a drop is an unavoidable consequence of functioning of a market capitalist economy. Such a view differs significantly from the deliberations of many economists who hold insufficient demand as the main cause of the crisis. We think that insufficient demand appears on the surface as a cause of the crisis. However, insufficient demand is just a consequence of a previously overheated economy faced with the drop of MEC. Consequently, a crisis cannot be prevented by expansive financial policy. Therefore it should come as a surprise that Keynes in the last year of his life retreated from his ideas expressed in General Theory and declared himself as not Keynesian any more (Hutchison, 1981).We think that major systemic, institutional as well as structural changes need to be taken in majority of developed economies in order to cope efficiently with present and future crisis.
Volume (Year): 27 (2009)
Issue (Month): 2 ()
|Contact details of provider:|| Postal: |
Web page: https://www.efri.uniri.hr/en/proceedings
More information through EDIRC
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.:
- George Argitis, 2003. "Finance, Instability and Economic Crisis: The Marx, Keynes and Minsky Problems in Contemporary Capitalism," Working Papers 0307, University of Crete, Department of Economics.
- George Argitis & Christos Pitelis, 2006. "Global Finance, Income Distribution And Capital Accumulation," Contributions to Political Economy, Oxford University Press, vol. 25(1), pages 63-81, August.
- George Argitis & Christos Pitelis, 2008. "Global Finance and Systemic Instability," Contributions to Political Economy, Oxford University Press, vol. 27(1), pages 1-11.
When requesting a correction, please mention this item's handle: RePEc:rfe:zbefri:v:27:y:2009:i:2:p:293-310. 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: (Antica Sergovic)
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.