The Keynesian Versus The Monetarist: A Lost Decade

Oliver Wiseman — Tue, 24 Feb 2015 12:02:36 +0000

Author:Martin Wolf

Debt and its consequences: Greeks queue for food after farmers went on strike in protest at bailout measures (Angelos Tzortzinis/AFP/Getty Images)

The monetarist Tim Congdon has attacked me and other Keynesians in two recent articles in this publication ("Don't let the Keynesians wreck the recovery", December 2014, and "Keynesians fear the US fiscal cliff. I don't", January/February 2013). These comments deserve a response.

In some circumstances, fiscal policy is indeed unusable. Greece was in this predicament in 2010. Is fiscal policy always unusable or even damaging? No. Mr Congdon is, in particular, wrong about the UK since 2010.

The Keynesian Versus The Monetarist: Time To Re-Read Keynes

Oliver Wiseman — Tue, 24 Feb 2015 11:43:03 +0000

Author:Tim Congdon

John Maynard Keynes (right): Have his disciples been right about him?

A key achievement of Keynes's General Theory was to guide economists towards better organisation of their analysis of the economy as a whole ("the macro-economy"). Crucially, national income was set when aggregate demand was equal to aggregate supply. A number of conditions had to be met for this to hold, including equality of investment with saving, and equality of the demand to hold money balances with the quantity of money created by the banking system.

Economics

The Keynesian Versus The Monetarist: A Lost Decade

The Keynesian Versus The Monetarist: Time To Re-Read Keynes