The Economic Contributions of Hyman Minsky: Varieties of Capitalism and Institutional Reform
Hyman Minsky's work represents one of the most important links between Post Keynesians and Institutionalists. We begin, in this essay, with a brief summary of some of his earlier work, including his well-known "financial instability hypothesis" and his policy proposals that were designed to reform the financial system, but pay more attention to his writings that explore other analysis and policy proposals that are less well known. These have been for the most part developed in the later years, after the publication of his Stabilizing an Unstable Economy (1986) book, and during his association with the Levy Institute. Minsky always insisted that theory must be institution-specific. Because there are a variety of possible types of economies, and even "fifty seven" varieties of capitalism, theory must be appropriate to the specific economy under analysis. His analysis concerned an evolving, developed, big-government capitalist economy with complex and long-lived financial arrangements. His policy recommendations were designed to promote a successful, democratic form of capitalism given these financial arrangements. These policies would have to "constrain" instability through creation of institutional "ceilings and floors" while at the same time they would have to address the behavioral changes induced by reduction of instability. The policies would also have to promote rising living standards, expansion of democratic principles, and enhancement of security for the average household. Thus, his proposals go far beyond "invisible handwaves" of free market idealogues, but also well beyond macroeconomic tinkering normally associated with "Keynesians" to take into consideration the required institutional change that would promote the sort of society he desired. In this sense, we think it is accurate to claim that Minsky successfully integrated "Post" (or, better, "financial") Keynesian theory wit
(This abstract was borrowed from another version of this item.)
When requesting a correction, please mention this item's handle: RePEc:lev:wrkpap:wp_217. 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: (Marie-Celeste Edwards)
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.