HOW TO DERIVE KEYNESIAN RESULTS FROM 1ST PRINCIPLES - A SURVEY OF NEW-KEYNESIAN ECONOMICS

H VANEES*, H GARRETSEN

*Corresponding author for this work

Research output: Contribution to journalReview articleAcademicpeer-review

5 Citations (Scopus)

Abstract

In the 1980s theoretical research in macroeconomics was dominated by what has become known as new-Keynesian economics. The principal aim of new-Keynesian economics is to explain how Keynesian results can be reconciled with the neo-classical principles of utility and profit maximization. This paper provides a survey and an assessment of New Keynesian economics. In our view, the theoretical foundation of new-Keynesian economics would be strengthened if more institutional detail is added to the analysis. The real challenge for new-Keynesian economics is to develop macrocconomics (and microeconomics) from a theory that takes the working of markets seriously.

Original languageEnglish
Pages (from-to)323-352
Number of pages30
JournalDe Economist
Volume141
Issue number3
Publication statusPublished - 1993

Keywords

  • IMPLICIT CONTRACTS
  • ASYMMETRIC INFORMATION
  • IMPERFECT INFORMATION
  • COORDINATION GAMES
  • LABOR-MARKETS
  • UNEMPLOYMENT
  • EQUILIBRIUM
  • MODELS
  • MONEY
  • COMPETITION

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