Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/oup/cambje/v29y2005i5p747-767.html
   My bibliography  Save this article

The ‘modern’ view of macroeconomics: some critical reflections

Author

Listed:
  • Alfonso Palacio-Vera
Abstract
David Romer has proposed a new basic macroeconomic framework: the IS--MP--IA model. Its proponents claim that it represents the 'modern' view of macroeconomics. We show that the new framework remains closely attached to the neoclassical synthesis and, in addition, does not take account of: (i) the empirical evidence on the output--inflation trade-off; (ii) the evidence on the interdependence of aggregate demand and supply; (iii) the institutional limits of monetary policy; and (iv) the implications for macroeconomic policy of (i), (ii) and (iii). Once these aspects have been incorporated, short-run stabilisation policy is not neutral in the long run, the notion of a 'natural' rate of interest becomes untenable and aggregate demand turns into the crucial exogenous variable. Copyright 2005, Oxford University Press.

Suggested Citation

  • Alfonso Palacio-Vera, 2005. "The ‘modern’ view of macroeconomics: some critical reflections," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 29(5), pages 747-767, September.
    • Handle: RePEc:oup:cambje:v:29:y:2005:i:5:p:747-767
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/cje/bei039
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. J.W. Mason & Arjun Jayadev, 2015. "Lost in Fiscal Space: Some Simple Analytics of Macroeconomic Policy in the Spirit of Tinbergen, Wicksell and Lerner," Working Papers 2015_05, University of Massachusetts Boston, Economics Department.
    2. Vasiliki Bozani, 2011. "NAIRU, Unemployment and Post Keynesian Economics," Working Papers 1104, University of Crete, Department of Economics.
    3. Eckhard Hein & Engelbert Stockhammer, 2010. "Macroeconomic Policy Mix, Employment and Inflation in a Post-Keynesian Alternative to the New Consensus Model," Review of Political Economy, Taylor & Francis Journals, vol. 22(3), pages 317-354.
    4. Eckhard Hein & Achim Truger, 2011. "Fiscal Policy in the Macroeconomic Policy Mix: A Critique of the New Consensus Model and a Comparison of Macroeconomic Policies in France, Germany, the UK and Sweden from a Post-Keynesian Perspective," Chapters, in: Claude Gnos & Louis-Philippe Rochon (ed.), Credit, Money and Macroeconomic Policy, chapter 12, Edward Elgar Publishing.
    5. Engelbert Stockhammer, 2008. "Is The Nairu Theory A Monetarist, New Keynesian, Post Keynesian Or A Marxist Theory?," Metroeconomica, Wiley Blackwell, vol. 59(3), pages 479-510, July.
    6. Alfonso Palacio Vera, 2008. "The "New consensus"and the Post-Keynesian approach to the analysis of liquidity traps," Documentos de trabajo de la Facultad de Ciencias Económicas y Empresariales 08-03, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:cambje:v:29:y:2005:i:5:p:747-767. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/cje .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.