The Consequences of Keynes

12 Pages Posted: 5 Jul 2016 Last revised: 19 Dec 2016

See all articles by Peter J. Boettke

Peter J. Boettke

George Mason University - Department of Economics

Patrick Newman

Florida Southern College

Date Written: October 15, 2016

Abstract

This paper discusses the consequences of John Maynard Keynes for the science of political economy, or the fields of economics, economic policy, and politics. It argues that the consequences of Keynes in all three fields were negative and resulted in a significant retrogression. For economics, a macroeconomic theory of an unstable capitalist economy supplanted the theory of the market process which concentrated on the individual actions of entrepreneurs and their effects on relative prices and production. For economic policy, activist tinkering on behalf of policy advisors replaced the theory of limited and hands off governments. For politics, unrestricted politicians and continual deficits and inflation replaced restrained politicians who adhered to balanced budgets and sound money.

Suggested Citation

Boettke, Peter J. and Newman, Patrick, The Consequences of Keynes (October 15, 2016). Journal of Markets and Morality, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2803980 or http://dx.doi.org/10.2139/ssrn.2803980

Peter J. Boettke

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States
703-993-1149 (Phone)
703-993-1133 (Fax)

Patrick Newman (Contact Author)

Florida Southern College ( email )

Lakeland, FL 33801
United States

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