Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
Krugman has recently revitalized IS-LM with a number of succinct analytical pieces on his blog. The reverberations were remarkable. Economists, however, are known often not grasp the full content of their own and, a fortiori, of others’ models. This happened to Keynes in the days of high theory and to Krugman in these days. Keynes applied a defect formalism, which is here replaced by objective-structural axioms. This yields the correct relationship between retained profit, saving, and investment which in turn makes it clear after the event that the IS-part of the IS-LM construct never could bear any substantive theoretical load.
|Date of creation:||11 Feb 2014|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Laidler,David, 1999.
"Fabricating the Keynesian Revolution,"
Cambridge University Press, number 9780521641739, August.
- Laidler,David, 1999. "Fabricating the Keynesian Revolution," Cambridge Books, Cambridge University Press, number 9780521645966, August.
- Olivier Blanchard, 2000. "What Do We Know about Macroeconomics that Fisher and Wicksell Did Not?," The Quarterly Journal of Economics, Oxford University Press, vol. 115(4), pages 1375-1409.
- Olivier Blanchard, 2000. "What do we know about Macroeconomics that Fisher and Wicksell did not?," NBER Working Papers 7550, National Bureau of Economic Research, Inc.
- Kakarot-Handtke, Egmont, 2011. "Reconstructing the Quantity Theory (I)," MPRA Paper 32421, University Library of Munich, Germany.
- Kakarot-Handtke, Egmont, 2011. "Reconstructing the Quantity Theory (II)," MPRA Paper 32542, University Library of Munich, Germany.
- F. A. Lutz, 1938. "The Outcome of the Saving-Investment Discussion," The Quarterly Journal of Economics, Oxford University Press, vol. 52(4), pages 588-614.
- Tomasson, Gunnar & Bezemer, Dirk J, 2010. "What is the Source of Profit and Interest? A Classical Conundrum Reconsidered," MPRA Paper 20320, University Library of Munich, Germany.
- Keen, Steve, 2010. "Solving the paradox of monetary profits," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 4, pages 1-32.
- Keen, Steve, 2010. "Solving the paradox of monetary profits," Economics Discussion Papers 2010-2, Kiel Institute for the World Economy (IfW).
- A. P. Lerner, 1938. "Saving Equals Investment," The Quarterly Journal of Economics, Oxford University Press, vol. 52(2), pages 297-309.
- Robert G. King, 1993. "Will the New Keynesian Macroeconomics Resurrect the IS-LM Model?," Journal of Economic Perspectives, American Economic Association, vol. 7(1), pages 67-82, Winter.
- Ingo Barens, 1997. "What Went Wrong with IS-LM/AS-AD Analysis--And Why," Eastern Economic Journal, Eastern Economic Association, vol. 23(1), pages 89-99, Winter. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:53608. 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: (Joachim Winter)
If references are entirely missing, you can add them using this form.