Economic theory and European society: The influence of J.M. Keynes∗

Abstract

The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. 1 1 J.M. Keynes, The General Theory of Employment, Interest and Money (London: Macmillan, 1936), p. 383. We have changed, by insensible degrees, our philosophy of economic life, our notions of what is reasonable and what is tolerable; and we have done this without changing our technique or our copybook maxims. Hence our tears and troubles. 2 2 J.M. Keynes, Essays in Persuasion (London: Macmillan, 1931), pp. 337–338.