Debunking Squared

Abstract

Steve Keen has debunked a good part of standard economics. However, he has left standing the theory of profit. This is unfortunate, because the theory of profit is the pivot of all of theoretical economics. This tightly focused paper clarifies the factual relation of profit and income, which should be helpful to put Keen’s alternative to the standard approach on sound foundations.

Keywords: new framework of concepts, structure-centric, consumption economy, Profit Law, market clearing, budget balancing, error detection, four quadrant scheme

JEL Classification: B59