Schools of economic thought: Post-Keynesian

Post-Keynesian economics treats the economy as a monetary phenomenon, with output, employment and investment driven by expected demand by consumers. Full employment and full capacity utilisation are not guaranteed. Uncertainty and lack of information dominate decision making. Economic behaviour is social and institutional, and not necessarily rational.

Unlike New Keynesianism, it rejects equilibrium and constrained optimisation of utility or profits as organising principles. Money is endogenous to the economic system and outcomes are path-dependent.

Relevant papers:

Compare the perspectives of economics” – Society for Pluralist Economics

A Post-Keynesian reading list – Post-Keynesian Economics Society

On the linkage between government expenditure and output: empirics of the Keynesian view versus Wagner’s law” – Arestis et al., 2021

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