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Keynes versus the Post Keynesians on the Principle of Effective Demand

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  • Jochen Hartwig

Abstract

The American Post Keynesians - those who attach importance to the 'Big P' and the absence of a dash between 'post' and 'Keynesian' - claim to be Keynes's most literal interpreters, or the 'truest' Keynesians (HOLT ET AL., 1998, p. 17). This paper compares the Post Keynesian interpretation of the Principle of Effective Demand, i.e. the D/Z-model, with Keynes's own presentation in Chapter 3 of the General Theory - and finds substantial differences. A reinterpretation of the D/Z-model is offered that would bring it into line with Chapter 3.

Suggested Citation

  • Jochen Hartwig, 2004. "Keynes versus the Post Keynesians on the Principle of Effective Demand," KOF Working papers 04-88, KOF Swiss Economic Institute, ETH Zurich.
  • Handle: RePEc:kof:wpskof:04-88
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    File URL: http://dx.doi.org/10.3929/ethz-a-004871570
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    References listed on IDEAS

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    7. Palley, Thomas I, 1997. "Expected Aggregate Demand, the Production Period and the Keynesian Theory of Aggregate Supply," The Manchester School of Economic & Social Studies, University of Manchester, vol. 65(3), pages 295-309, June.
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    Cited by:

    1. Marc Lavoie, 2010. "Surveying Short-run and Long-run Stability Issues with the Kaleckian Model of Growth," Chapters,in: Handbook of Alternative Theories of Economic Growth, chapter 6 Edward Elgar Publishing.

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    Keywords

    Effective demand; D/Z-model;

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