Dear David,

There appears to be a lack of consensus as to what post-Keynesian economics means. The early book by Kenneth Kurihara titled “Post Keynesian Economics” represented “the extension of Keynes’ General Theory by a group of well-known economists.” (1954, p. viii) Keynes saw his work as a break away from the classical economists, but he rejects Marxism as implied in in the statement “I believe that the future will learn more from the spirit of Gesell than from that of Marx. (General Theory 1936, p. 355)

Samuelson contrast monetarism with his brand of post-Keynesian Economics, which consists of three propositions: 1. Changes in thriftiness and the MPC can affect output, prices and production, 2. Exogenous burst in investment or the animal spirit has systematic effect on GNP, and 3. Increase in public expenditure, or cut in the tax rate has systematic effect on GNP. (Collected Scientific Papers of Samuelson 1977, V. 4, p. 765) Samuelson, Modigliani, Solow, Klein are also representative of a group of post-Keynesian. At one time Klein declared that he was a Marxist, but not the others.

Another set of post Keynesians includes Paul Davidson, G. Harcourt, L. Pasinetti, A. Medio, E. Nell etc.

Post Keynesians such as L. Pasinetti, question whether a break with Keynes from the classics had occurred, pointing to reconciliations that were going on “…between the group of young economist who had been working with Keynes…and those economists who, after publication, tried to reconcile the General Theory with traditional thinking.” (Pasinetti, Luigi, L. “J. M. Keynes’s ‘revolution’—the major event of twentieth-century economic?” in Luigi L. Pasinetti and Bertram Schefold, The Impact of Keynes on Economics in the 20th Century, (U.K.: Edward Elgar, 1999), 3-15.

1999, 3) He concluded that a Keynesian revolution “might as yet remain unaccomplished”, waiting for something analogous to the Arrow-Debreu formulation of Leon Walas to happen to J. M. Keynes. (Ibid., 1999, 13). John Hicks wrote that the survival of “…classical economics into the post-Keynesian epoch is not the same thing as the survivals of outmoded scientific theories…It survives because we have found that we have to attend, sometimes at least, to some of the things which Keynes left out.” (Hicks, Collected Papers, Vol. 1., 1981, 234).

The post-Keynesian Paul Davidson has a partiality for authenticity, opposing Samuelson for triangulating between “gross substitution” where any interest bearing capital can substitute for money, “money neutrality”, where money is neutral on its effect of output, and “ergodic hypothesis”, where “In an ergodic system where the future can be reliable predicted…where the gross substitution axiom underlies all demand curves, then as long as prices are flexible, money must be neutral and the system automatically adjusts to full employment equilibrium.” (Davidson, Collected Writings, 2007, V. 4. 214-215) Davidson predicted that “…as we entered the 21st century, only the Post Keynesians remain to carry-on in Keynes’s analytical footsteps and develop Keynes’s theory and policy prescription for the 21st century real world of economic globalization. “ (Davidson, 2007, V. 4, 209).

I do not therefore, see a clear distinction.

Dear David,

There appears to be a lack of consensus as to what post-Keynesian economics means. The early book by Kenneth Kurihara titled “Post Keynesian Economics” represented “the extension of Keynes’ General Theory by a group of well-known economists.” (1954, p. viii) Keynes saw his work as a break away from the classical economists, but he rejects Marxism as implied in in the statement “I believe that the future will learn more from the spirit of Gesell than from that of Marx. (General Theory 1936, p. 355)

Samuelson contrast monetarism with his brand of post-Keynesian Economics, which consists of three propositions: 1. Changes in thriftiness and the MPC can affect output, prices and production, 2. Exogenous burst in investment or the animal spirit has systematic effect on GNP, and 3. Increase in public expenditure, or cut in the tax rate has systematic effect on GNP. (Collected Scientific Papers of Samuelson 1977, V. 4, p. 765) Samuelson, Modigliani, Solow, Klein are also representative of a group of post-Keynesian. At one time Klein declared that he was a Marxist, but not the others.

Another set of post Keynesians includes Paul Davidson, G. Harcourt, L. Pasinetti, A. Medio, E. Nell etc.

Post Keynesians such as L. Pasinetti, question whether a break with Keynes from the classics had occurred, pointing to reconciliations that were going on “…between the group of young economist who had been working with Keynes…and those economists who, after publication, tried to reconcile the General Theory with traditional thinking.” (Pasinetti, Luigi, L. “J. M. Keynes’s ‘revolution’—the major event of twentieth-century economic?” in Luigi L. Pasinetti and Bertram Schefold, The Impact of Keynes on Economics in the 20th Century, (U.K.: Edward Elgar, 1999), 3-15.

1999, 3) He concluded that a Keynesian revolution “might as yet remain unaccomplished”, waiting for something analogous to the Arrow-Debreu formulation of Leon Walas to happen to J. M. Keynes. (Ibid., 1999, 13). John Hicks wrote that the survival of “…classical economics into the post-Keynesian epoch is not the same thing as the survivals of outmoded scientific theories…It survives because we have found that we have to attend, sometimes at least, to some of the things which Keynes left out.” (Hicks, Collected Papers, Vol. 1., 1981, 234).

The post-Keynesian Paul Davidson has a partiality for authenticity, opposing Samuelson for triangulating between “gross substitution” where any interest bearing capital can substitute for money, “money neutrality”, where money is neutral on its effect of output, and “ergodic hypothesis”, where “In an ergodic system where the future can be reliable predicted…where the gross substitution axiom underlies all demand curves, then as long as prices are flexible, money must be neutral and the system automatically adjusts to full employment equilibrium.” (Davidson, Collected Writings, 2007, V. 4. 214-215) Davidson predicted that “…as we entered the 21st century, only the Post Keynesians remain to carry-on in Keynes’s analytical footsteps and develop Keynes’s theory and policy prescription for the 21st century real world of economic globalization. “ (Davidson, 2007, V. 4, 209).

I do not therefore, see a clear distinction.

Thanks, Professor Ramrattan. Very insightful.

What are your thoughts on Massimo Pivetti and Heinrich Bortis, who, in my opinion, work towards establishing a Classical Keynesian paradigm, in which value is classical, in the neo-ricardian sense, so to speak, of Sraffa, and is in combination with Keynes' long-run theory of effective demand?

With respect to distinctions, it is difficult to ascertain, like you said, especially, moving passed Samuelson et. al, (among who I don't think have had a clue of Keynes' intentions) many self-described Post Keynesians suggest that extending the work of Keynes's either means centering attention on the notion of uncertainty or calling attention to long-run positions of stability (centers of gravity, so to speak).

And then there is the question of class...can you be Keynesian and still subscribe to the surplus approach of the classics a la Marx, Ricardo, etc? if so, is this Post-Keynesian? (Kalecki?)

What does one mean, for instance, when let's say a Marxist mums that he or she is becoming more Post-Keyensian, both in theory and in praxis? How am I supposed to interpret this? Quite frankly, I do not have a clear idea of what the  take away should be...does it mean an inclination to be more reformist, with the advocation of aggregate demand management policies coupled with redistribution, than revolutionary, by trembling the ruling establishment?

And then there is the question of how to reconcile Keynes ideas not just with classical political economy but with the old institutionalism of Veblen, Kapp & Commons...

In the final instance, it's like what you said, the distinctions aren't very clear. In my view, if 'Post' is replaced with 'Left' and preceded by 'Classical' in the Marx/Ricardo/Sraffa sense, and proceeded by 'Keynesian', such that the research question pertains to long-run unemployment or full employment equilibria in connection to the notion of a super-multiplier, I believe we would have a straightforward (Post) Keynesian school of thought...