Lars P. Syll — On the non-neutrality of money

Summary:
One of Keynes’s central tenets — in clear contradistinction to the beliefs of mainstream economists — is that there is no strong automatic tendency for economies to move toward full employment levels in monetary economies. Money doesn’t matter in mainstream macroeconomic models. That’s true. But in the real world in which we happen to live, money does certainly matter. Money is not neutral and money matters in both the short run and the long run.... "New Keynesianism" isn't Keynesian. It is bastard Keynesianism if it is Keynesian at all. Paul Krugman self-identifies as "neoclassical," in accepting neutrality of money, banks as only intermediaries, equilibrium, and rational maximization. So do many if not most other Democratic Party economics heavyweights and advisors. Time for them to

Topics:
Mike Norman considers the following as important: john maynard keynes, money neutrality, neoclassical economics, Neoliberalism, New Keynesianism, paul krugman

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