The problematic nature and consequences of the effort to force Keynes into the conceptual cul-de-sac of Walrasian economics

Abstract

The all-too-common tendency to ignore, misunderstand, misinterpret or misrepresent the central arguments of Keynes’s General Theory is the result not of flaws or a lack of clarity in their expression but rather of Kuhnian incommensurability. The paradigms of Keynes and of General Equilibrium are fundamentally at odds. Attempts to reconcile Keynes’s arguments with, or to address his arguments within, a General Equilibrium context are thus likely to entail misunderstanding, misinterpretation and misrepresentation, and an inclination to ignore their original meaning. At a time when his arguments are as important as ever, methodological intransigence still prevents much of the profession from understanding that he offers a template for developing a better understanding of the functioning, and malfunctioning, of market systems, and that he identifies crucially important policy solutions within this framework.