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The World Economy in Crisis – The Return of Keynesianism?


  • Sebastian Dullien

    (University of Applied Sciences, Germany)

  • Eckhard Hein

    (Berlin School of Economics and Law, Germany)

  • Till van Treeck

    (Macroeconomic Policy Institute (IMK) in the Hans Boeckler Foundation, Germany)

  • Achim Truger

    (Macroeconomic Policy Institute (IMK) in the Hans Boeckler Foundation, Germany)


The world economy is in crisis. Since the initial turbulences in the U.S. subprime mortgage market in the summer of 2007, we have experienced a global recession in 2008-9 and a wave of financial speculation threatening the existence of the European Monetary Union in 2009-10. At the same time, there has been a remarkable shift in economic policies and economic thinking more broadly. Hardly anyone would doubt today that the Keynesian stimulus packages which were put in place all over the world have so far prevented an even sharper fall in output and increase in unemployment and poverty. Fiscal policy is again considered a powerful tool for macroeconomic stabilisation policies. Similarly, few would now question the necessity of tighter regulation of the financial markets. Central banks around the world have taken ‘unconventional measures’ such as the purchase of asset-backed-securities to stabilise the financial system and the real economy. But the crisis also has more structural roots, amongst which are the massive increases in income and wealth inequalities over the past three decades or so, and the global imbalances in international trade. At this stage, it is still unclear how far policy makers around the world will be able to live up to these challenges. The chapters in this book address these issues from different angles, analysing the underlying structural causes of the crisis, assessing the policy responses to the crisis with a special emphasis on Europe, and making concrete proposals for financial market reforms and a Keynesian New Deal more broadly.

Suggested Citation

  • Sebastian Dullien & Eckhard Hein & Till van Treeck & Achim Truger (ed.), 2010. "The World Economy in Crisis – The Return of Keynesianism?," Conference proceedings of the Research Network Macroeconomics and Macroeconomic Policies (FMM), IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute, volume 13, number 13-2010, June.
  • Handle: RePEc:imk:fmmcps:13-2010

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    Cited by:

    1. Detzer, Daniel & Hein, Eckhard, 2014. "Finance-dominated capitalism in Germany: Deep recession and quick recovery," IPE Working Papers 39/2014, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    2. Achim Truger, 2013. "Austerity in the euro area: the sad state of economic policy in Germany and the EU," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 10(2), pages 158-174.
    3. Detzer, Daniel & Hein, Eckhard, 2014. "Financialisation and the financial and economic crises: The case of Germany," IPE Working Papers 44/2014, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    4. Hein, Eckhard. & Mundt, Matthias., 2012. "Financialisation and the requirements and potentials for wage-led recovery : a review focussing on the G20," ILO Working Papers 994709323402676, International Labour Organization.

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