Keynesian Reflections

The global financial crisis, which began in August 2007 and continues with no end in sight, has thrown macroeconomics into turmoil. This book challenges the current mainstream macroeconomic tradition, rejecting the view that whatever shock hits the economy, the response is an automatic and rapid move towards market equilibrium that pulls the economy out of any kind of difficult situation. Engaging with the structural problems of our times, especially in the context of the global financial crisis, the essays not just engage with Keynesian economics, but also adapt and go beyond it as per the requirements of present conditions. The essays apply the 'Keynesian spirit' to cover four broad areas: effective demand in the crisis, economic theory in the context of world recession, money and international liquidity, and finance and international economic disorder. Suggesting an alternative future of macroeconomics, this volume inspires and provokes new economic thinking that is needed for the world today.LIST OF TABLES AND FIGURES ; PREFACE ; INTRODUCTION ; LIST OF ABBREVIATIONS ; I. EFFECTIVE DEMAND IN THE CRISIS ; 1. RE-EMBRACING KEYNES: SCHOLARS, ADMIRERS, AND SCEPTICS IN THE AFTERMATH OF THE CRISIS ; 2. THE DOG CALLED INVESTMENT ; 3. KEYNES, KALECKI, AND THE REAL WORLD ; II. ECONOMIC THEORY AND THE WORLD RECESSION ; 4. THE STATE OF MACROECONOMICS IN VIEW OF GLOBAL FINANCIAL CRISIS ; 5. KEYNES AND CAPITALISM: THE CASE OF JAPAN ; 6. KEYNES AND THE CASE FOR EUROPE ; III. MONEY AND INTERNATIONAL LIQUIDITY ; 7. WAS KEYNES' MONETARY POLICY A OUTRANCE IN THE TREATISE, THE MODEL FOR ZIRP AND QE? ; 8. LIQUIDITY PREFERENCE OF BANKS AND CRISES ; 9. WHY NOT BANCOR? KEYNES'S CURRENCY PLAN AS A SOLUTION TO GLOBAL IMBALANCES ; 10. IN A KEYNESIAN MOOD? WHY EXCHANGE RATE SYSTEMS COLLAPSE ; IV. FINANCE AND INTERNATIONAL ECONOMIC DISORDER ; 11. UNCERTAINTY AND SPECULATION IN THE KEYNESIAN TRADITION: RELEVANCE IN COMMODITY FUTURES ; 12. FINANCIAL KEYNESIANISM AND MARKET INSTABILITY ; 13. FINANCIAL GLOBALIZATION AND THE FUTURE OF THE FED ; 14. SOME FORESEEABLE DISASTERS OF THE GLOBAL ECONOMY: THE HIGH COST OF NEGLECTING KEYNES'S APPROACH