John Maynard Keynes: A Study in the Psychology of Original Work PDF
Preview John Maynard Keynes: A Study in the Psychology of Original Work
JOHN MAYNARD KEYNES Also by Piero V. Mini KEYNES, BLOOMSBURY AND THE GENERAL THEORY PIDLOSOPHY AND ECONOMICS: The Origins and Development of Economic Theory John Maynard Keynes A Study in the Psychology of Original Work Piero V. Mini M St. Martin's Press © Piero V. Mini 1994 Softcover reprint of the hardcover 1st edition 1994 978-0-333-58584-9 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP9HE. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. First published in Great Britain 1994 by THE MACMILLAN PRESS LTD Houndmills, Basingstoke, Hampshire RG21 2XS and London Companies and representatives throughout the world A catalogue record for this book is available from the British Library. ISBN 978-1-349-23608-4 ISBN 978-1-349-23606-0 (eBook) DOI 10.1007/978-1-349-23606-0 First published in the United States of America 1994 by Scholarly and Reference Division, ST. MARTIN'S PRESS, INC., 175 Fifth A venue, New York, N.Y. 10010 ISBN 978-0-312-12137-2 Library of Congress Cataloging-in-Publication Data Mini, Piero V., 1936-- John Maynard Keynes : a study in the psychology of original work I Piero V. Mini. p. em. Includes bibliographical references and index. ISBN 978-0-312-12137-2 I. Keynes, John Maynard, 1883-1946. 2. Keynesian economics. I. Title. HBI03.K47M53 1994 330. 15'6--dc20 93-48289 CIP To the memory of M.M. Zeus: You, Aegisthus, have, like me, a passion for order. Aegisthus: For order? That is so. It was for order that I wooed Clytemnestra, for order that I killed my King; I wish that order should prevail, and that it would pre vail through me. I have lived without love, without hope, even without lust. But I have kept order in my kingdom. That has been my ruling passion; a godlike passion, but how terrible! Jean-Paul Sartre, The Flies, 1943 Albert and the blond beasts make up the world between them. If either cast the other out, life is diminished in its force. John Maynard Keynes, 'Einstein', 1933 Contents Acknowledgements viii Introduction I Essentialism and Existentialism: My Early Beliefs 14 2 Probability: The First 'Struggle of Escape' 32 3 The War Years: 'Education Through Violence' 47 4 New Uncertainties: Public Opinion and Diplomacy 72 5 Speculation: Education by the Financial Markets 84 6 The Twenties: Economic and Methodological Heresies 94 7 The Macmillan Committee and the Treatise 107 8 Platonic Forms 120 9 Classical Economics as Platonic Forms 134 I 0 Existentialism and Keynes 148 II Existentialism in The General Theory 164 I2 The Second World War: Opportunity and Threat 183 I3 Was Keynes an Economist? 214 Appendix 1: A Classical Statement of the Multiplier 227 Appendix II: Fitzgibbons on 'Animal Spirits' 229 Notes 231 Select Bibliography 248 Index 252 vii Acknowledgements Permission to quote has been obtained from: Universidade Cat6lica Portuguesa, publisher of Economia, where the material of Appendix I appeared in May 1989; Macmillan Publishers and St. Martin's Press, for the diagram appearing on p. 177 from Vol. VIII of The Collected Writings of John Maynard Keynes. For preparing the typescript I wish to thank Ms Jackie David and her able assist ants. For putting it into shape for the printer and for catching many oversights it is a pleasure to thank Ms Anne Rafique. viii Introduction This book is not a biography of Keynes. Like my previous one, 1 it is an effort to understand Keynes's major economic work through the beliefs he expressed in his other writings. These are viewed as being influenced by his personality and philo sophy of life. Basically, this is a book on the methodology used by Keynes, a methodology determined by his general philosophical beliefs, and determining the unique nature of his economic theories. To schematise our standpoint: events, edu cation, experiences, psychology determine a philosophy of life. Philosophy of life determines methodology. And methodology determines theories. Keynes's Collected Writings are the main source of our work. The biographies, gen erally speaking, are somewhat vitiated by the rationalism of the writer. Economists especially (as against cultural historians) bring to the study of Keynes the same ration alism that characterises their theoretical work. A rationalist is one who believes in the superiority of the mind (working along logico-mathematicallines) in unearthing the truth, mind being infinitely superior in this respect to experience, to feelings and to passionate involvement. The bafflement that writers about Keynes often feel in his presence is an indication that they have not grasped his nature. The philosopher Braithwaite, for instance, who had known Keynes since 1919 and had thought him a 'humane utilitarian,' was shocked by My Early Beliefs with its rejection of the whole utilitarian ethic and of the notion that human nature is reasonable. Not only is human nature not reasonable, Keynes wrote, but life is richer for its being so! Then there is the case of the new preface to the German translation (September 1936) of The General Theory in which Keynes claims that his theory of output 'is more easily adapted to the conditions of a totalitarian state' (with its stronger leadership) than is the classical theory based on laissez-faire. 2 Keynesian scholars are shocked: a sorrowful Moggridge notes that 'Keynes displayed remarkable insensitivity, indeed indifference, to a regime that put its political opponents into concentration camps and passed the anti-semitic Nuremburg laws'. Keynes, he says, did not have to provide a preface for the German edition, and if he feit that he had to, he did not have to go 'as far as he did'. 'It is all shameful-and puzzling.'3 Keynes's remarks about the economic method pioneered by Tinbergen also have puzzled and wounded many economists and with good reason for Keynes indicts econometrics as 'black magic', 'alchemy', 'all hocus', 'a nightmare', while its practitioners are 'charlatans'. Then there is Keynes's interest in genetics: while talking about the need for a national policy to control population (in England), he added that in the future the community as a whole will have to pay attention to its 'innate qualities' as well as to the mere size of the population, a remark repeated to a German audience in Berlin in 1926.4
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