The Italian theories of progressive taxation∗

In this paper I evaluate the logical consistency of Patinkin's claim that involuntary unemployment can result from slow speed of adjustment. I argue that Patinkin's argument is flawed because of an unjustified breach of continuity in the trade technology assumption between the microeconomic and the macroeconomic parts of Money, Interest, and Prices. Finally, I claim that the issue of flexibility versus rigidity should be linked to the trade technology assumption. As soon as a centralized trade technology is assumed, flexibility automatically comes in.     

Comment: Lucas on involuntary unemployment

Keynes distinguishes three concepts: voluntary, frictional and(Keynesian) involuntary unemployment. Frictional unemploymentis a Classical form of involuntary unemployment (not voluntary,as Lucas suggests), and reflects the Marshallian, rather thanWalrasian, treatment of time and equilibrium. Lucas contradictsboth Keynes and Pigou in asserting that there are always immediatevacancies for unskilled labour, and abstracts from the veryproblem that Keynes seeks to address. If voluntary unemploymentis re-defined appropriately, as De Vroey helpfully suggestselsewhere, the prefix ‘involuntary’ is dispensable,not because all unemployment is voluntary, as Lucas would haveit, but because it is all involuntary.     

Lucas on involuntary unemployment

The aim of this paper is to examine critically Lucas' argumentsagainst Keynes's General Theory and in particular against Keynes'sconcept of involuntary unemployment. It comprises two main parts.In the first part of the paper, the author questions Lucas'sclaim that Keynes betrayed the equilibrium discipline by freeinghimself from the postulates of optimising behaviour and marketclearing. In the second part, Lucas’ three arguments againstthe involuntary unemployment concept are discussed—first,that there is no rationale for drawing a distinction betweentwo sorts of unemployment; second, that every economic outcomefeatures the voluntary and the involuntary jointly; and third,that alternatives to unemployment are always present.     

Keynes, Lucas and involuntary unemployment: a reply to Hayes

In this response to Mark Hayes's criticism of his article, ‘Lucason involuntary unemployment’, the author insists on theneed to draw a distinction between labour rationing (a marketoutcome) and unemployment (the activity of job seeking). Economictheory is mainly concerned with the former. Yet the issue ofthe voluntarity versus the involuntarity of unemployment pertainsto unemployment as an activity. Failing to make this distinctioncannot but lead to semantic confusion.     

The Double Dividend Debate: Some Comments from a Politico-Economic Perspective

During recent years, using theoretical and simulation models there has been an extensive debate about the welfare and employment effects of ecological taxes. This paper is a comment on this double dividend debate from a politico-economic perspective. First, a graphical representation of the main results of the theoretical models developed by Bovenberg et al. is given. After some remarks on the difference between the results of the theoretical and simulation models some more general remarks on welfare analysis and optimal taxation theory are made. After this, the question of the tax base is tackled. Finally, it is asked what we can learn from this debate for environmental policy purposes.     

国际失业属性理论回溯

失业属性是失业理论发展的重要观察视角.本文基于对失业属性的认识.从凯恩斯对劳动供求数量失衡的观察到\"后凯恩斯主义\"对劳动供求结构失衡的认识和人力资本理论对劳动供求质量失衡的认识,以及发展经济学对发展中国家工业化过程中劳动数量供给特殊性的观察,正是在人们对失业属性的认识逐步深化过程中,失业理论得到了不断发展.     

Wage Flexibility and Unemployment: The Keynesian Perspective Revisited

Keynes' main concern in the General Theory is about the capacity of an economy to return to full employment equilibrium when subject to a (negative) demand shock. He maintains that money wages cuts may not help reabsorb unemployment, as they do not necessarily imply a fall in real wages. On the contrary, wage rigidity may be necessary for avoiding that a cumulative process propels the economy far away the full employment equilibrium. Co‐ordination failures in the investment‐saving market are behind this conclusion. However, the analysis is carried out within a static equilibrium framework. This paper is an attempt to focus on the problems of intertemporal co‐ordination arising within the context of a sequential economy. Our analysis of the out‐of‐equilibrium process of adjustment stirred by a shock allows to generalize the original Keynesian intuition. Unemployment emerges as the result of a lack of co‐ordination due to irreversibly constrained choices, and not only nominal but also real wage flexibility does not necessarily help to restore equilibrium. As a matter of fact, it may even be harmful, by triggering processes that make the economy diverge from equilibrium. Our analysis has important analytical implications as regards the role of market imperfections and the interpretation of the effects of monetary policy.     

Old views and new perspectives: on reading Hick's ‘Mr. Keynes and the Classics’ *

This paper discusses the different macroeconomic models presented in Hicks's seminal 1937 article on the IS-LM (or SI-LL) approach. Hicks's treatment of the supply side Keynes's reaction to the different SI-LL models later developments of SI-LL by Hicks and his comments on the construction of SI-LL are discussed. It is argued that one of the different SI-LL models does indeed represent a faithful rendition of the analytical core of Keynes's General Theory and does belong more to the Marshall-Pigou-Keynes tradition than to a Walrasian tradition. Textbook IS-LM (and AS-AD) models are compared to the original SI-LL models. It is argued that textbook IS-LM is decisively different from the SI-LL approach this difference being the cause of presently discussed problems and obscurities of the textbook IS-LM/AS-AD approach.     

On the links between unemployment rate, monetary creation and the value-added sharing

In this paper, we investigate the analytical links between the rate of unemployment, monetary creation and how individuals share the value added in an economy with three types of agents: capital owners, managers and employees. This relationship relies on the fact that the rate of unemployment depends on many macroeconomic characteristics such as: creation of money, external balance of goods and services and mark-up pricing. The latter being decomposed into the expected margin rate and the growth rate of the unitary wage cost that characterize the primary value-added sharing.     

Multilateralism and military Keynesianism: Completing the analysis

Kalecki’s analysis of military Keynesianism highlights the difficulties of managing aggregate demand in one country, without coordination with trading partners. Military Keynesianism is effective as a means of reflation because, unlike civilian public works, it induces similar expenditure by political rivals. In this way it overcomes some of the trade difficulties that arise if aggregate demand expands in only one country.     

A Nightmare in Introductory Economics

In a pair of 1925 lectures, John Maynard Keynes described world economic history with reference to a classification of stages developed by John R. Commons. This article examines Keynes’s two 1925 lectures in the context of Commons’s writings. It spotlights lesser-known aspects of Commons’s scholarship and helps clarify ambiguities in Keynes’s two addresses. It also identifies a key document, written by Commons, upon which Keynes relied when developing his presentations. In addition, the article explains how the work of Commons and Keynes in the 1920s has relevance for the contemporary development of evolutionary Keynesianism (which can also be called Post-Keynesian Institutionalism).     

The logic of Keynes' criticism of the Classical model

The Classics' remedy for unemployment was to lower money wages. Keynes opposes this remedy. Therefore, in The General Theory, he aims at building a model in which a fall in money wages may not cause an increase in employment. Most of the interpretations of Keynes identified this aim, but did not attach enough importance to it. Reading The General Theory in the light of this aim, we discover what Keynes' logic of elaboration is, then what Keynes' ideas about voluntary or involuntary unemployment are.     

Keynes against Kalecki on economic method

In the past twenty years, there has been considerable debate on the “coherence” of post Keynesian economics, in view of post Keynesian economists’ ambitions to develop a paradigmatic alternative to neoclassical economics. Given the growing importance of methodological aspects in this discussion, this article addresses the differences of approach to economic theory between the fathers of the two most important strands in post Keynesian economics. We thus focus on Keynes’s criticism of Kalecki’s theory of the business cycle and the tensions between Keynes’s logical approach and Kaleki’s formal modeling. We show that in criticizing Kalecki’s theory, Keynes made use of the same methodological criticism (based on detecting logical fallacies in reasoning) he had employed to attack both the classical theory and contemporary “pseudo-mathematical” models. After illustrating these fundamental differences between Keynes and Kalecki about the proper way of doing economics, we draw some conclusions on the possible future evolution of post Keynesian economics.