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The classical theory of the cycle explained

April 14, 2016

I received an email yesterday from someone in America who had read my Say’s Law and the Keynesian Revolution who was then proposing to write a blog about what he had found. And lo and behold, that he has now done: How Keynesian Economics Has Distorted Economic Thinking (Somewhat wonkish). It never occurred to me that all this stuff is for the more studious types, but there you are. Looks natural and straightforward to me. It’s this Keynesian nonsense that requires the effort. You can read the whole of his post at the link, but here’s how it ends:

Contrary to popular belief, Keynes and many of his followers have misrepresented classical economics. This has led many to renounce classical theory without realizing that it not only offers logical explanations for the business cycle, but that the classicalists were well-versed in and rejected Keynesianism before it became known as Keynesianism. And that’s a fact that merits more attention.

I, of course, go beyond the notion that these ideas merit more attention. I am along the lines that Keynesian theory should go the way of the labour theory of value and the textbooks that carry this debilitating infection should be consigned to the furnace. But that’s just me.

Finally, I will just mention the list of labels he has attached to his post:

Labels: Classical Theory, David Ricardo, Jean-Baptiste Say, John Maynard Keynes, John Stuart Mill, Keynesian Economics, Say’s Law

There they are, almost everything you need to know about what makes an economy go, specially that John Stuart Mill fellow, and Say’s Law.

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