IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

In Search of Lost Time: The Neoclassical Synthesis

  • Michel De Vroey


  • Pedro Garcia Duarte


Present-day macroeconomics has sometimes been dubbed ‘the new neoclassical synthesis’, suggesting that it constitutes a reincarnation of the neoclassical synthesis of the 1950s. This paper assesses this understanding. To this end, we examine the contents of the ‘old’ and the ‘new’ neoclassical syntheses. We show that the neoclassical synthesis originally had no fixed content, but two meanings gradually became dominant. First, it designates the program of integrating Keynesian and Walrasian theory. Second, it designates the methodological principle that in macroeconomics it is better to have alternative models geared towards different purposes than a hegemonic general-equilibrium model. The paper documents that: (a) the first program was never achieved; (b) Lucas’s criticisms of Keynesian macroeconomics eventually caused the neoclassical synthesis program to vanish from the scene; (c) the rise of DSGE macroeconomics marked the end of the neoclassical synthesis mark II; and (d) contrary to present-day understanding, the link between the old and the new synthesis is at best weak..

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by University of São Paulo (FEA-USP) in its series Working Papers, Department of Economics with number 2012_07.

in new window

Date of creation: 07 May 2012
Date of revision:
Publication status: Published
Handle: RePEc:spa:wpaper:2012wpecon07
Note: Published in the "B.E. Journal of Macroeconomics", Jan. 2013, 13(1).
Contact details of provider: Postal: (011) 818-5811
Phone: +55-11-3091-5944
Fax: +55-11-3091-6013
Web page:

More information through EDIRC

Order Information: Email:

References listed on IDEAS
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.:

as in new window
  1. Blanchard, Olivier J & Galí, Jordi, 2005. "Real Wage Rigidities and the New Keynesian Model," CEPR Discussion Papers 5375, C.E.P.R. Discussion Papers.
  2. Michel De Vroey, 2009. "A Marshall-Walras Divide? A Critical Review of the Prevailing Viewpoints," History of Political Economy, Duke University Press, vol. 41(4), pages 709-736, Winter.
  3. Wiles, Peter, 1973. "Cost Inflation and the State of Economic Theory," Economic Journal, Royal Economic Society, vol. 83(330), pages 377-98, June.
  4. Pedro Garcia Duarte, 2011. "Not Going Away? Microfoundations in the Making of a New Consensus in Macroeconomics," Working Papers, Department of Economics 2011_02, University of São Paulo (FEA-USP).
  5. Michel DE VROEY, 2009. "Marshall and Walras : Incompatible Bedfellows ?," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2009008, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  6. Benassy, Jean-Pascal, 1975. "Neo-Keynesian Disequilibrium Theory in a Monetary Economy," Review of Economic Studies, Wiley Blackwell, vol. 42(4), pages 503-23, October.
  7. Paul Davidson, 1978. "Why Money Matters: Lessons from a Half-Century of Monetary Theory," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 1(1), pages 46-70, October.
  8. James Tobin, 1992. "An Old Keynesian Counterattacks," Eastern Economic Journal, Eastern Economic Association, vol. 18(4), pages 387-400, Fall.
  9. Aspromourgos, Tony, 1986. "On the Origins of the Term 'Neoclassical.'," Cambridge Journal of Economics, Oxford University Press, vol. 10(3), pages 265-70, September.
  10. David Romer, 1993. "The New Keynesian Synthesis," Journal of Economic Perspectives, American Economic Association, vol. 7(1), pages 5-22, Winter.
  11. Fand, David I, 1969. "Keynesian Monetary Theories, Stabilization Policy, and the Recent Inflation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 1(3), pages 556-87, August.
  12. N. Gregory Mankiw, 2006. "The Macroeconomist as Scientist and Engineer," Harvard Institute of Economic Research Working Papers 2121, Harvard - Institute of Economic Research.
  13. Michel De Vroey & Pierre Malgrange, 2012. "From The Keynesian Revolution to the Klein-Goldberger model: Klein and the dynamization of Keynesian theory," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 20(2), pages 113-136.
  14. Diamond, Peter A, 1982. "Aggregate Demand Management in Search Equilibrium," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 881-94, October.
  15. Paul A. Samuelson, 1997. "Credo of a Lucky Textbook Author," Journal of Economic Perspectives, American Economic Association, vol. 11(2), pages 153-160, Spring.
  16. Ronald G. Bodkin & Lawrence R. Klein & Kanta Marwah, 1991. "A History of Macroeconometric Model-Building," Books, Edward Elgar, number 51, March.
  17. Barro, Robert J & Grossman, Herschel I, 1971. "A General Disequilibrium Model of Income and Employment," American Economic Review, American Economic Association, vol. 61(1), pages 82-93, March.
  18. Franco Donzelli, 2005. "Equilibrium and Tâtonnement in Walras' Eléments," UNIMI - Research Papers in Economics, Business, and Statistics unimi-1010, Universitá degli Studi di Milano.
  19. Davidson, Paul, 1972. "A Keynesian View of Friedman's Theoretical Framework for Monetary Analysis," Journal of Political Economy, University of Chicago Press, vol. 80(5), pages 864-82, Sept.-Oct.
  20. Yann Giraud, 2013. "The Political Economy of Textbook Writing : Paul Samuelson and the making of the first Ten Editions of Economics (1945-1976)," Working Papers hal-00870494, HAL.
  21. Franco DONZELLI, 2010. "Hicks on Walrasian equilibrium in the 1930s and beyond," Departmental Working Papers 2010-39, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  22. Olivier Blanchard, 2009. "The State of Macro," Annual Review of Economics, Annual Reviews, vol. 1(1), pages 209-228, 05.
  23. Marvin Goodfriend & Robert King, 1997. "The New Neoclassical Synthesis and the Role of Monetary Policy," NBER Chapters, in: NBER Macroeconomics Annual 1997, Volume 12, pages 231-296 National Bureau of Economic Research, Inc.
  24. Lawrence R. Klein, 1947. "Theories of Effective Demand and Employment," Journal of Political Economy, University of Chicago Press, vol. 55, pages 108.
  25. Tarascio, Vincent J, 1974. "Vilfredo Pareto and the Translation of his Manuel," Journal of Economic Literature, American Economic Association, vol. 12(1), pages 91-96, March.
  26. Pedro Garcia Duarte, 2011. "Recent Developments in Macroeconomics: The DSGE Approach to Business Cycles in Perspective," Chapters, in: The Elgar Companion to Recent Economic Methodology, chapter 16 Edward Elgar.
  27. Michael Woodford, 2009. "Convergence in Macroeconomics: Elements of the New Synthesis," American Economic Journal: Macroeconomics, American Economic Association, vol. 1(1), pages 267-79, January.
  28. Joan Robinson & Francis Cripps, 1979. "Keynes Today," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 2(1), pages 139-144, October.
  29. repec:ema:worpap:2011-18 is not listed on IDEAS
  30. Loasby, Brian J, 1971. "Hypothesis and Paradigm in the Theory of the Firm," Economic Journal, Royal Economic Society, vol. 81(324), pages 863-85, December.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:spa:wpaper:2012wpecon07. 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: (Pedro Garcia Duarte)

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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.