Secular Stagnation: The History of a Macroeconomic Heresy

European Journal of the History of Economic Thought, vol, 23 (6), 2016

36 Pages Posted: 5 May 2015 Last revised: 3 Jul 2016

Roger Backhouse

University of Birmingham - Department of Economics

Mauro Boianovsky

Universidade de Brasilia

Date Written: May 5, 2015

Abstract

This paper covers the history of secular stagnation from Alvin's Hansen's AEA Presidential address in 1938 to the recent re-discovery of the idea by Lawrence Summers. It is argued that the story of secular stagnation is more complicated than the simple version usually told: the theory changed in ways that meant that, though its immediate relevance might be less, postwar prosperity left open the possibility that it might one day become relevant. It is also pointed out that the history of the term has never been free of political concerns, and it is suggested that changing conceptions of economic theory played an important role in the fate of secular stagnation.

Keywords: secular stagnation, unemployment equilibrium, Keynesian economics, Hansen

JEL Classification: B22, E12, E24, E32, E62

Suggested Citation

Backhouse, Roger and Boianovsky, Mauro, Secular Stagnation: The History of a Macroeconomic Heresy (May 5, 2015). European Journal of the History of Economic Thought, vol, 23 (6), 2016. Available at SSRN: https://ssrn.com/abstract=2602903 or http://dx.doi.org/10.2139/ssrn.2602903

Roger Backhouse

University of Birmingham - Department of Economics ( email )

Economics Department
Birmingham, B15 2TT
United Kingdom

Mauro Boianovsky (Contact Author)

Universidade de Brasilia ( email )

Brasilia, DF 70910-900
Brazil

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