It is becoming more apparent that modern macro with its Keynesian Y=C+I+G is utterly defective to the point of vacuity but the problem remains what ought to replace it? Here is my formula in brief:
1) never use variations in aggregate demand to explain anything
2) recognise that growth is driven by value adding production alone
3) the structure of production is the core concept in understanding how an economy works – even aggregate supply is a near on useless concept
4) government spending after perhaps the first 10% is never value adding
5) only businesses subject to the disciplines of profit and loss can be expected to create value
6) government subsidies to business do not create faster growth or more employment
7) recessions are inevitable
8) recessions can never be cured by higher levels of public spending.
Want more? See my Free Market Economics: an Introduction for the General Reader.