Title: Equilibrium and Employment in The General Theory
Abstract:In the opening of The General Theory Keynes states that he intends to argue that «(...) the situation which [the classical theory] assumes [is] a limiting point of the possible positions of equilibriu...In the opening of The General Theory Keynes states that he intends to argue that «(...) the situation which [the classical theory] assumes [is] a limiting point of the possible positions of equilibrium»1. The project which Keynes undertakes and describes in the three Chapters which make up Book I is ac tually to provide a representation of the functioning of the economie system which results in general in an equilibrium of the system together with under utilization of available resources. This justifies for Keynes the attribution of the word «general» to his theory and to the case described in it, as opposed to the special case — full employment equilibrium — described in the classical theory2. I am not concerned here with whether Keynes was successful in demonstrating this or even if such a demonstration is possible starting from some or ali of the basic elements of the keynesian analysis. My interest is directed at the following question: are the causes which determine unemploy ment the same throughout The General Theory, or, from another point of view, is there only one concept of equilibrium in The General Theory or are there different concepts such that their diversity implies and needs different explanations, and therefore different causes, of the unemployment equi librium?Read More
Publication Year: 1986
Publication Date: 1986-01-01
Language: en
Type: article
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Cited By Count: 2
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