OUTSIDE THE MAINSTREAM: AN INTERVIEW WITH AXEL LEIJONHUFVUD

Abstract

Axel Leijonhufvud made an enormous impact on macroeconomics in the late 1960s with the publication of his bookOn Keynesian Economics and the Economics of Keynes: A Study of Monetary Economics(1968). In this famous book, Leijonhufvud argued that the standard neoclassical synthesis (Hicks–Hansen IS-LM) interpretation of the General Theory totally misunderstood and misinterpreted Keynes. However, during the 1970's, interest in Keynes and Keynesian models waned as new classical equilibrium models became all the rage. Nevertheless, Leijonhufvud, from a position outside the mainstream, continued his research into problems of unemployment, business cycles, and inflation—issues that from his perspective are problems of coordination failure in complex dynamical systems. Axel Leijonhufvud is currently Professor Emeritus at the University of California, Los Angeles, and, since 1995, Professor of Monetary Economics at the University of Trento, Italy. In this interview the author discusses with Leijonhufvud a wide range of issues relating to his own work as well as his views on the development of macroeconomics after Keynes.