Monday, February 13, 2012

What does "Keynesian" mean?

The title of this post is the title of a post by Jonathan Portes  at the Not the Treasury View blog.  One interesting point about his answer is that it all seems to boil down to your view on the effectiveness of fiscal policy - you're defined as a Keynesian if you believe fiscal policy works (to oversimplify his detailed argument to a ridiculous degree).  But isn't there more to it than just that policy argument?  After all, A.C. Pigou joined with Keynes in signing a letter to the Times (linked to here) calling for public works to counter unemployment, and Keynes, in the General Theory, treated Pigou (rather unfairly) as the representative Classical economist.