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Keynes's degree of competition


  • M. G. Hayes


The present paper argues that Keynes's theory of aggregate employment assumes perfect competition (understood as price-taking, in the modern sense promoted by Joan Robinson in her 1934 article) in the markets for current output and for existing capital-goods. The degree of competition, to which Keynes makes a single cryptic reference, refers to the social and institutional obstacles to the free movement of resources, associated mainly with closed shops of entrepreneurs and workers. Keynes is here invoking an older, Marshallian, concept of competition. The implication is that the received understanding of the terms 'expectation' and 'liquidity' in The General Theory needs revision.

Suggested Citation

  • M. G. Hayes, 2008. "Keynes's degree of competition," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 15(2), pages 275-291.
  • Handle: RePEc:taf:eujhet:v:15:y:2008:i:2:p:275-291
    DOI: 10.1080/09672560802037599

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    References listed on IDEAS

    1. Mark Hayes, 2006. "The Economics of Keynes: A New Guide to The General Theory," Books, Post Keynesian Economics Study Group (PKSG), number nggt.
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    Cited by:

    1. M.G. Hayes, 2012. "Keynes, the Neglected Theorist," Chapters,in: Keynes’s General Theory, chapter 2 Edward Elgar Publishing.
    2. M. G. Hayes, 2013. "The State of Short-term Expectation," Review of Political Economy, Taylor & Francis Journals, vol. 25(2), pages 205-224, April.


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