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The History of Macroeconomics Viewed Against the Background of the Marshall-Walras Divide

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  • Michel, DE VROEY

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

Analysing the recent history of macroeconomics, my paper claims that the new classical revolution should be viewed as a substitution of Walrasian macroeconomics to the earlier prevailing Marshalian macroeconomics. The first part of the paper is concerned with two conceptual prerequisites, the relationship between macroeconomics and general equilibrium, the meaning of the “Keynesianism” modifier. In a second part, the different facets of the Marshall-Walras divide are expounded. My general claim is substantiated in the third paper of the paper. Herein, I claim that the IS-LM model is a simplified Marshallian general equilibrium model while real business cycle models belong to the Walrasian reserach programme. Finally, I express my scepticism as to the possibility of a New Neoclassical Synthesis.

Suggested Citation

  • Michel, DE VROEY, 2004. "The History of Macroeconomics Viewed Against the Background of the Marshall-Walras Divide," LIDAM Discussion Papers IRES 2004017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2004017
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    Cited by:

    1. Andrés Álvarez & Vincent Bignon, 2013. "L. Walras and C. Menger: two ways on the path of modern monetary theory," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 20(1), pages 89-124, February.
    2. Michel De Vroey, 2012. "Microfoundations: A Decisive Dividing Line between Keynesian and New Classical Macroeconomics?," Chapters, in: Microfoundations Reconsidered, chapter 5, Edward Elgar Publishing.
    3. Jörg Guido Hülsmann1, 2012. "The Meaning Of Macroeconomics," Romanian Economic Business Review, Romanian-American University, vol. 7(3), pages 40-54, September.
    4. Zoran Stefanovic, Branislav Mitrovic, 2015. "Revisiting New Institutional Economics: Basic Concepts And Research Directions," Ekonomika, Journal for Economic Theory and Practice and Social Issues 2014-04, „Ekonomika“ Society of Economists, Niš (Serbia).
    5. Kevin Hoover, 2005. "Dr. Keynes: Economic Theory in a Diagnostic Science," Working Papers 199, University of California, Davis, Department of Economics.
    6. Pedro Garcia Duarte & Gilberto Tadeu Lima, 2012. "Microfoundations Reconsidered," Books, Edward Elgar Publishing, number 14869.
    7. Pedro Garcia Duarte, 2013. "A Path Through the Wilderness: Time Discounting in Growth Models," Working Papers, Department of Economics 2013_18, University of São Paulo (FEA-USP).
    8. Mark Hayes, 2006. "The Economics of Keynes: A New Guide to The General Theory," Books, Post Keynesian Economics Society (PKES), number nggt.
    9. Pedro Garcia Duarte, 2012. "Not Going Away? Microfoundations in the Making of a New Consensus in Macroeconomics," Chapters, in: Microfoundations Reconsidered, chapter 6, Edward Elgar Publishing.
    10. Kevin Hoover, 2005. "Dr. Keynes: Economic Theory in a Diagnostic Science," Working Papers 63, University of California, Davis, Department of Economics.
    11. Schilirò, Daniele, 2005. "Il simposio su "mr. Keynes' system" all'Oxford meeting e il modello is-lm [The symposium on " mr. Keynes' system" to the Oxford meeting and the is-lm model]," MPRA Paper 33019, University Library of Munich, Germany.
    12. Michel De Vroey, 2007. "Did The Market‐Clearing Postulate Pre‐Exist New Classical Economics? The Case Of Marshallian Theory," Manchester School, University of Manchester, vol. 75(3), pages 328-348, June.

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    More about this item

    Keywords

    History of macroeconomics; Neoclassical Synthesis; New Neoclassical Synthesis; Keynesianism; Monetarism;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General

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