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Been there done that: the political economy of Déjà Vu

Author

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  • Boettke, Peter
  • Smith, Daniel
  • Snow, Nicholas

Abstract

In the midst of the current financial crisis the economics profession has seen a monumental resurrection of Keynesian ideas. The debate, which Keynes started back in the 1930s, is being picked up again, not where it left off, but in exactly the same place it started. While Keynesian theories were carefully critiqued by new classical economists and in the most part discarded by the profession, Keynesian models and prescriptions became a staple of politics and macroeconomic textbooks. Obviously, neither side of the debate articulated their views adequately and on the same terms. If the economics profession is going to escape this perpetual déjà vu of cycling through the same debate every time an economic crisis emerges, the profession must discard entrenched ideologies and turn back to the sound but creative application of basic economics.

Suggested Citation

  • Boettke, Peter & Smith, Daniel & Snow, Nicholas, 2011. "Been there done that: the political economy of Déjà Vu," MPRA Paper 32094, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:32094
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    References listed on IDEAS

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    Cited by:

    1. Joanna Dzionek-Kozlowska, 2014. "Economics in Times of Crisis. In Search of a New Paradigm," Lodz Economics Working Papers 5/2014, University of Lodz, Faculty of Economics and Sociology.
    2. Boettke, Peter & Smith, Daniel, 2011. "Robust political economy and the Federal Reserve," MPRA Paper 32092, University Library of Munich, Germany.
    3. Boettke, Peter & Coyne, Christopher, 2011. "The debt-inflation cycle and the global financial crisis," MPRA Paper 32091, University Library of Munich, Germany.

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    More about this item

    Keywords

    Financial Crisis; Keynesian Economics; Inflation; Housing Bubble; Regime Uncertainty; John Maynard Keynes;
    All these keywords.

    JEL classification:

    • B53 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Austrian
    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative

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