Anticipations of the Crisis: On the Similarities between Post Keynesian Economics and Regulation Theory

32 Pages Posted: 10 Sep 2010

Date Written: September 9, 2010

Abstract

The purpose of this paper is to explore the similarities between Post Keynesian Economics (PKE) and Regulation Theory (RT). It is argued that, despite important differences between these traditions, the analytical contents of PKE and RT display broad similarities with respect to their treatments of the income-generating process, the crisis-prone nature of capitalism, and the institutional contingency of capitalist growth and development. This thesis is then exemplified and substantiated with reference to the 2007-2009 financial crisis and “Great Recession”. Specifically, it is shown that important strands of both PKE and RT characterize and were successful in anticipating the crisis as the result of the exhaustion of a financialized growth process.

Keywords: Post Keynesian Economics, Regulation Theory, Great Recession, financial crisis

JEL Classification: B50, E11, E12, E21, E24

Suggested Citation

Setterfield, Mark, Anticipations of the Crisis: On the Similarities between Post Keynesian Economics and Regulation Theory (September 9, 2010). Available at SSRN: https://ssrn.com/abstract=1674748 or http://dx.doi.org/10.2139/ssrn.1674748

Mark Setterfield (Contact Author)

New School for Social Research ( email )

6 East 16th Street
New York, NY 10003
United States

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