The Notion of Equilibrium in the Keynesian Theory

264 Pages·1992·24.914 MB·English

by  Mario Sebastiani (eds.)

THE NOTION OF EQUlLffiRIUM IN THE
KEYNESIAN THEORY
Also from Mario Sebastiani and from Palgrave Macmillan:
KALECKI'S RELEVANCE TODAY
The Notion of
Equilibrium in the
Keynesian Theory
Edited by
Mario Sebastiani
Professor of Economics
University ofR ome "Tor Vergara"
Palgrave Macmillan
ISBN 978-1-349-22088-5 ISBN 978-1-349-22086-1 (eBook)
DOI 10.1007/978-1-349-22086-1
© Mario Sebastiani 1992
Softcover reprint of the hardcover 1s t edition 1992
All rights reserved. For infonnation, write:
Scholarly and Reference Division,
St. Martin's Press, Inc., 175 Fifth Avenue,
New York, N.Y. 10010
First published in the United States of America in 1992
ISBN 978-0-312-07259-9
Library of Congress Cataloging-in-Publication Data
The Notion of equilibrium in the Keynesian theory/edited by Mario
Sebastiani.
p. cm.
Papers from a Mar. 1987 symposium sponsored by the Istituto di
economia e finanza of the University of Perugia.
Includes index.
ISBN 978-0-312-07259-9
1. Keynesian economics-Congresses. 2. Equilibrium (Economics)
-Congresses. I. Sebastiani, Mario. II. Universita di Perugia.
Istituto di economia e finanza.
HB99.7.N67 1992
339.~c20 91-32577
CIP
In memory of Tom Asimakopulos
Contents
Acknowledgements ix
Dedication x
Notes on the Contributors xi
Introduction Xlll
1 The Nature and Role of Equilibrium in Keynes's
General Theory 1
A. Asimakopulos
2 A Note on Keynes's Use of the Term 'Equilibrium' in the
General Theory 13
Don Patinkin
3 Keynes and Equilibrium: A Note 18
M. Tonveronachi
4 Keynes and Conventional Equilibria 32
Bruce Littleboy
5 Keynesian Equilibrium and the Inducement to Invest 46
Olga Capponi
6 Keynes and Long-Period Positions 61
Mario Sebastiani
7 Keynes and the Concept of Equilibrium 74
G. Caravale
8 On Keynes's Method in Economic Theory 99
G. C. Harcourt
9 The General Theory: Critical and Constructive 106
R. M. Goodwin
10 The Identity between Aggregate Supply and Demand Price
Equilibrium and Labour Market Equilibrium at Less than
Full Employment 109
1. A. Kregel
vii
viii Contents
11 Keynesian Unemployment is Involuntary and is an
Equilibrium State 120
Bruno fossa
12 Equilibrium without Constraints 138
Edward f. Nell
13 Social Norms, Fluctuations and Money in a Linear Model
of Prices 173
Sergio Parrinello
14 Information Failures and Wandering Systems in Keynesian
Economics: Clower-Leijonhufvud Revisited 189
Christian Arnsperger
15 A Note on Kalecki's and Keynes's Unemployment
Equilibrium 218
f. Osiatynski
16 Post Keynesians versus New Keynesians on Imperfect
Competition and Unemployment Equilibrium 223
Andrea Boitani
Index of Authors 241
Index of Subjects 244
Acknowl edgements
In March 1987, on the initiative of the Istituto di Economia e Finanza of
the University of Perugia, a symposium was held on 'The Notion of
Equilibrium in the Keynesian Theory', which lends its title to this volume.
This initiative was made possible by the financial support from Consiglio
Nazionale delle Ricerche. Gratitude is also due to the Regione Umbra for
having allowed Palazzo Cesaroni to be the seat of the conference.
The editor is particularly indebted to Giuseppe Dallera, head of the
Istituto di Economia e Finanza, for his full collaboration in the organisa
tion of the symposium.
Finally, the contribution of all the participants is here acknowledged
for the rich and interesting dimension they gave to the debate, even though
not all the studies could be included in this volume.
MARIO SEBASTIANI
Rome
IX
Dedication
This book is dedicated to the memory of Athanasios Asimakopulos. Tom
died in Montreal on 25 May 1990 just a few days before his 60th birthday,
and after a long and typically courageous battle against leukaemia. He
was at the conference in Perugia; he gave his usual lucid, scholarly and
crystal-clear exposition, both of his own paper and in discussion. The
theme of the conference was one to which he himself had made distin
guished contributions over the years.
Tom was a graduate of McGill and Cambridge Universities: he taught
at McGill for virtually all of his working life. His principal mentors were
the late Jack Weldon (whom he succeeded as William Dow Professor in
1988) and the late Joan Robinson. They, together with Keynes, Kalecki
and Harrod, were the main influences on his thought. His objective in
teaching and research was always to interpret their theories carefully and
faithfully so that his pupils too could form structures of thought by which
to analyse economic issues, inspired by Tom's own original and scholarly
understanding.
Tom was a man of outstanding integrity and intellectual courage. He
always followed arguments wherever they led, no matter how disquieting
the conclusions - and, sometimes, the consequences for his own reputation
with the unimaginative, the hidebound and the mean-minded. Those of
us who knew Tom was struck by these characteristics as we were by his
warm kindly nature, his devotion to his friends and, most of all, his devotion
to his beloved family, his wife, Marika and their two daughters, Anna
and Julia. Here was a man who combined high intelligence with com
passion and humanity, both in his work and in his life; a dear man who
inspired respect, admiration and affection in equal measure.
G. C. HARCOURT
Cambridge
x