Anti-Keynes Reading List

Miscellaneous General
1

If one of these has already been made, please delete this one (or merge it into the other thread).

Books

Keynes the Man by Murray Rothbard

Failure of the New Economics by Henry Hazlitt

The Critics of Keynesian Economics by Henry Hazlitt

Where Keynes Went Wrong by Hunter Lewis

Contra Keynes and Cambridge by F.A. Hayek

Tiger by the Tail by F.A. Hayek

The Theory of Idle Resources by William Hutt

A Rehabilitation of Say’s Law by William Hutt

The Economics of Illusion by L.Albert Hahn

Also see Rothbard, Man,Economy,and State Chapter 11 Section 5F “Hoarding and the Keynesian System” (pg 776) and Section 17 “Further Fallacies of the Keynesian System” (pg 859)

as well as Rothbard, Making Economic Sense ,Chapter 11 “Keynesian Myths” (pg 43) and Chapter 12 “Keynesianism Redux” (pg 45)

In addition, see Jesus Huerta de Soto, Money,Bank Credit,and Economic Cycles Chapter 7 Section 3 “Criticism of Keynesian Economics” (pg 542)

Articles/Essays

The Misesian Case Against Keynes by Hans-Hermann Hoppe (this can also be found in Hoppe’s book, “The Economics and Ethics of Private Property”)

Stones into Bread:The Keynesian Miracle by Ludwig von Mises

Lord Keynes and Say’s Law by Ludwig von Mises

Spotlight on Keynesian Economics by Murray Rothbard

The Critical Flaw in Keynes’s System by Robert Murphy

Keynes and the Pyramids by Paul A. Cantor

Was Keynes A Liberal? by Ralph Raico

Keynes and Space Aliens by Clifford F. Thies

Hazlitt and Keynes:Opposite Callings by Lew Rockwell

Keynes and the Ruling Class by Garet Garrett

The Upside Down World of John Maynard Keynes by Mark Thornton

Keynes and the Reds by Ralph Raico

Reflections on the Pure Theory of Money of Mr.J.M. Keynes by F.A. Hayek

The Many Collapses of Keynesianism by Lew Rockwell

Please post anything I left out and I’ll add it to the list.

2

Just out of interest, have you read many pro-Keynes books or journal papers?

3

Is there much of a reason to do so?

4

It’s the prevailing dogma. So…

Many of us, like myself, went through ‘intro to economics’ programs and the like, and were force-fed Keynes with nary a mention of Mises. In any case, he’s been thoroughly debunked, and the only people who are still Keynesian partisans are generally those who haven’t been exposed to other systems of thought, or whom push Keynesianism for political reasons.

The event that gave even the partisans in government pause was Stagflation, an event which was supposed to be impossible under General Equilibrium / Keynesian doctrine, where the economy experienced high interest rates, inflation, and unemployment.

When your theory says something is impossible and that event takes place, kinda hard to keep the prestige you had going, even if it was unearned prestige.

That prestige existed only because Keynesianism cast governments as the prime mover and saver of an economy, which is exactly what the politicians wanted to hear. Keynesianism’s influence is tied directly to that fact.

5

I had the fortune of having a Hayekian professor, so we got both perspectives.

6

Have I? No. The only critique of Keynesianism I’ve read are the brief critiques Rothbard gives it in For a New Liberty and Economic Depressions:Their Cause and Cure. I’ve also read Keynes the Man but that’s more of a biography and not really an economic critique.

I just posted this as a go-to list for myself and other people who want to read Anti-Keynes books.

7

Is there much of a reason to do so?

Yes. If I was only to read anti-Austrian texts, do you believe I would get an accurate understanding of Austrian economics? Reading original sources is of vast importance in any subject area that you wish to learn about, especially if we are talking about a contentious subject area like economics in which all sorts of ideological biases creep in.

This is not to defend either Keynesianism or Austrian economics, just to point out that learning is a process that should be approached with a critical mind, and that being critical requires relying on your own interpretation of texts not merely the critique presented by others.

8

It’s the prevailing dogma. So…

Many of us, like myself, went through ‘intro to economics’ programs and the like, and were force-fed Keynes with nary a mention of Mises. In any case, he’s been thoroughly debunked, and the only people who are still Keynesian partisans are generally those who haven’t been exposed to other systems of thought, or whom push Keynesianism for political reasons.

The event that gave even the partisans in government pause was Stagflation, an event which was supposed to be impossible under General Equilibrium / Keynesian doctrine, where the economy experienced high interest rates, inflation, and unemployment.

When your theory says something is impossible and that event takes place, kinda hard to keep the prestige you had going, even if it was unearned prestige.

That prestige existed only because Keynesianism cast governments as the prime mover and saver of an economy, which is exactly what the politicians wanted to hear. Keynesianism’s influence is tied directly to that fact.

Well I’ve recently started an undergrad course on which one of the modules is econ101. It seems to me that the prevailing dogma is Neoclassical rather than Keynesian. It was my impression that Keynesianism was abandonned in the late 70’s and early 80’s after the stagflation that you mention. When did you study economics, btw?

9

No, it’s still taught as a live doctrine. Most economics courses will tend to situate it as the rival of classical economics, to be succeeded by monetarism/rational expectations theory. But the essentials of Keynesianism are still taught. If you do an economics degree you’ll certainly have a good understanding of what Keynesians support.

As for whether it is worth probing deeper into keynesian texts, that is solely contingent on whether you wish to probe deeper into the subject especially in light of the scarcity of time. I mean I’d rather spend time learning how to safeguard my wealth from the coming crisis. So it’s a personal decision. It also depends on the intellectual honesty of the critics you’re reading. When you say works by the supporters of Keynesianism, who do you mean? Samuelson’s textbooks are still used in universities.

10

Formally, in the 90’s. It also depends where and under whom you’d studied. At the time I chose not to go into econ as a profession, though it was my first choice, because of the emphasis on econometric econ programs, and the limited job scope of graduates–if you didn’t want to go into government work at least :stuck_out_tongue:

Even in the 90’s you were still facing New Synthesis ideas which incorporated Keynes and Keynesian approaches with neoclassical ideas. I’d be very surprised if modern econ as taught in schools today were widely abandoning Keynes. Keynes is the darling of leftist economics and they cling to him like a life-raft, because he provided the veneer of intellectual justification for the things they already wanted to do: command an economy.

Today it’s Post-Keynesianism largely, which is still, ironically, strongly influenced by Keynesianism.

11

^

Well this is one of the things that I’ve really been struggling to come to grips with since I entered into my program; what is the prevailing orthodoxy, exactly? My understanding thusfar is that neo-classical economics is the widely accepted school of microeconomic thought. Neo-classicalism offers very little in the way of macroeconomic thought, however. This is why Hayek claimed that Keynes was the first person to have a real conception of macroeconomics as such. This is reinforced, in my mind, by the fact that Keynes starts of The General Theory by trying to identify the “classical” approaches to macroeconomic matters like employment, growth, and business cycles, but he finds work in all of these areas as being rather scant.

In this way I believe that it’s more appropriate to describe Keynesianism as and “add-on” to neo-classical economics. It is ultimately based upon neo-classicalism, however it expands upon the doctrine to more macroeconomic fields of interest, which neo-classicalism itself doesn’t really touch except through the vague implications of its microeconomic theories. As for what the orthodoxy is, the answer is rather mixed. I feel like since the 70’s and 80’s Keynesianism as such as fallen out of favor, it’s a lot less clear, even to the orthodoxians themselves, what the answer is, especially with rational expectations and monetarism running around and messing up the neat little world of Keynes. I feel like this is why, in macro, there is a much greater discussions of “economic schools” and “economic models” than in micro. In micro it doesn’t really matter all that much because, at least in the orthodox views, there’s a general agreement as to how market work and why they fail, whereas in macroeconomics the answer is much less clear.

EDIT

It is important to note, however, that no matter how macroeconomics is understood, it is always understood through a keynesian lens in orthodox academia. This is why macroeconomic supply and demand is, for the most part, the centerpoint of all intro macro courses. Spending drives the economy and capital is assumed to be homogeneous, the question is what can boost spending the most, the government or the market.

12

Even in the 90’s you were still facing New Synthesis ideas which incorporated Keynes and Keynesian approaches with neoclassical ideas. I’d be very surprised if modern econ as taught in schools today were widely abandoning Keynes. Keynes is the darling of leftist economics and they cling to him like a life-raft, because he provided the veneer of intellectual justification for the things they already wanted to do: command an economy.

Today it’s Post-Keynesianism largely, which is still, ironically, strongly influenced by Keynesianism.

The first part of this sounds about right. No doubt large elements of Keynes’ work will still influence what is taught, but the impression I get is that the theories we are learning naturally lend thermselves to Conservative politics, certainly not left-wing by any stretch of the imagination. As for the post-keynesian stuff you mention, this is definitely not part of the course I am on.

I guess the ideological bias that exists on a course will depend on the institution you attend, but as far as I am aware, what I am learning is the standard content of 99% econ101 courses here in the UK

13

Ah, well there’s no such standard curricula in the US intro to econ courses.

14

This is the syllabus for my intermediate macroeconomics class taught by a libertarian. He is not Austrian but he is anti-Keynes.

15

The first part of this sounds about right. No doubt large elements of Keynes’ work will still influence what is taught, but the impression I get is that the theories we are learning naturally lend thermselves to Conservative politics, certainly not left-wing by any stretch of the imagination. As for the post-keynesian stuff you mention, this is definitely not part of the course I am on.

Keynesianism and its modern variants aren’t necessarily left-wing or right-wing. Both sides could find support for their policies in it. Conservatism, I find, tends to be more about a misguided form of nationalism than anything else, and this certainly includes policies that aggrandise the state.

As to what the orthodoxy is, you need to analyse it in terms of micro and macro. At the micro level, there’s precious little disagreement, even though some macro arguments might seep into micro. Even Austrians, although they differ on several issues with neoclassical economists, do not offer an entirely upside down worldview. There is some political bias masquerading as economics here, e.g. public goods, perfect competition etc., but it’s limited. I think where Austrianism and the Virginia School (public choice) differ (besides methodology for the former, although neoclassical econ is not really “empiricist” or even instrumentalist so much as formalist) is that they will extend their theorems to the state as well. Neoclassical econ just assumes the state’s existence and necessity. But with respect to the major approaches taught, micro is primarily neoclassical with little disagreement. This isn’t to say that there are not huge disagreements between Austrians and neoclassicals, but insofar as orthodox micro is concerned, these aren’t yet entering the fray, and Austrians/neoclassicals will by and large agree on micro. Marxism is another alternative to neoclassical micro.

With respect to macro, it is whatever benefits the state. This might be supply side econ, Keynesian in some shape or form (in fact it is always an operative theory in almost all government action at present, I mean which government doesn’t measure wealth via GDP?), Real Business Cycle theory (RBC) or monetarism. Consequently, all are taught. Austrian capital-influenced macro doesn’t even enter discussions at present. I think macro is the area of economics most divorced from reality. It veers even further into the instrumentalist direction than the formalist micro, so perhaps this is why. Assumptions are made insofar as they are useful for yieldng predictions. Classical macro is still taught but largely in an historical context.

The real business cycle bunch (Lucas amongst others) discredited Keynesianism after monetarism dealt it the first deathblows, but it is coming under attack in light of the recent financial crisis for its unrealistic assumptions of what information market agents possess. Some of its advocates even go so far as to pretend that you cannot identify such a thing as a bubble.

I guess the conclusion to draw from this is that macro comprises a competing set of policy tool rationalisations i.e. schools of macroeconomic thought. They all speak in similar language and with similar toolsets, and all exist to assist the state in managing the economy, even if it’s in a “if the state must exist…” way. Like Neodoxy said, macro is largely spoken in Keynesian, even if a particular school disagrees with it. This is why Austrianism, if adopted, will entail a paradigm shift, because it doesn’t even really divide economics into micro and macro.

16

“Neoclassical econ just assumes the state’s existence and necessity. But with respect to the major approaches taught, micro is primarily neoclassical with little disagreement. This isn’t to say that there are not huge disagreements between Austrians and neoclassicals, but insofar as orthodox micro is concerned, these aren’t yet entering the fray, and Austrians/neoclassicals will by and large agree on micro.”

This is what I’ve had such a hard time actually believing since I’ve entered into my econ classes. There are so many assumptions, especially the state. I might be able to understand this if the public choice school hadn’t been active for decades now, but the time for such a constrained analysis is over. I see this constrained worldview and “compartmentalization” of thought everywhere in mainstream economics to the point that it’s hard to pinpoint a unified theory which can even be called “economic orthodoxy” at times. What I’m coming to admire both about Austrianism and Marxism are that they both full explanations of micro and macro. They act as totally coherent worldviews… Even though Marxism isn’t coherent.

It’s also great that as an Austrian you can enjoy the quality insights made by Neo-Classicals while discarding the stuff that’s wrong, and knowing exactly why it’s wrong.

17

Modern economics is taught primarily to give intellectual cover to state power. As a profession it’s been largely co-opted. This is because of the deference given to people with advanced degrees. If they can wave some equations at the public, too advanced to be easily understood, people will throw up their hands and opposition melts.

In essence the above is a short description of Keynes’s entire career as an economist :stuck_out_tongue: