The Future Of Post-Keynesian Economics?
One of the good things I learned is that the paperback version of Marc Lavoie’s Post-Keynesian Economics: New Foundations is now available in North America. I reviewed it earlier (link), and one of the few negatives was the somewhat prohibitive price of the hardcover version.The conference featured one session with Marc Lavoie laying out his vision for post-Keynesian economics, and then another session with responses from a few academics.
Marc Lavoie's work points in an optimistic direction for post-Keynesian thought. He offers a fairly coherent theoretical view, by bringing together the common threads within the various schools of thought within post-Keynesian economics. Instead of wasting time upon differences of doctrine, the emphasis should be on building a new body of thought that can work in methodological differences. Professor Lavoie's speech, as well as the responses, pointed in this direction.
Unfortunately, I have concerns about the prospects for post-Keynesian economics within academia. There is plenty of evidence that analytical failure does not prevent advancement in academia or in official institutions. We now have Paul Krugman referring to Minsky, and articles from the Bank of England showing that loanable funds theory does not work using DSGE models. In other words, it is possible for the mainstream to absorb policy recommendations from post-Keynesians, without touching the analytical core of mainstream macroeconomics. This response is much more convenient to the mainstream than admitting that much of the edifice of mainstream macro is an analytical failure.
Correspondingly, post-Keynesians may win the war of ideas in academia, but it is highly possible that they will not get the credit they deserve.
(c) Brian Romanchuk 2015
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