A History of Post Keynesian Economics since 1936 (Awarded Choice Outstanding Academic Title for 2002) [Paperback]

This book contains flashes of insight and occassionally makes for entertaining reading, but I walked away with a general sense of disappointment and frustration. King is clearly very knowledgeable about his subject. My criticism is directed only at the manner in which he executed the exposition of this history. King does what I call "the author run-around". No where in this book does King give a real detailed analysis of any part of post-Keynesian economics. He summarizes important points in one or two sentences, and when in later chapters he needs to introduce these points again in order to give an intellgible account of the history and theory of post-Keynesian economics, he simply refers the reader to the earlier chapters in which nothing was really explained.

Now this book is comprehensive in its treatment of the relevant material, but it is just too short and concise to be valuable or useful to any student/scholar in post-Keynesian economics. The author speeds through the history, exhaustively referencing all the important literature, but in the end no detailed explanation is really provided on any of the important elements that make up the post-Keynesian view.

However, with all that said, the reader after finishing the book is able to place the historical development of post-Keynesian economics in context, and can with some accuracy identify the differences and sources of disagreement that continue to exist. Particular emphais is put on income distribution, monopoly power (and pricing), endogenous money, long period growth, and uncertainty. The author also does a good job of organizing the chapters into separate discussions of pure theory and history. My favorite chapter was probably the one on the first US post-Keynesians. I really enjoyed the discussions of Hyman Minsky and Paul Davidson.

I just wish the book, being as comprehensive as it is, were longer and more detailed in its analysis.

King's history of Post Keynesian(PK) Economics gives a general overview of the founding of a distinct PK view.A distinct PK school is traced back by King to two individuals,J M Keynes and M Kalecki.King covers the claim made,according to one of the founding PKers,by Joan Robinson, that Kalecki had written a superior,mathematical version of the theory of effective demand three years(1933) before Keynes wrote his supposedly strictly literary analysis in the General Theory(GT) in 1936.These claims ,as King shows,have led to the fracturing of the PK school.King also covers the capital theory controversies between Cambridge,Massachusetts(Massachusetts Institute of Technology)and Cambridge,England(Cambridge University)over the roles played by the rate of interest and theoretical neoclassical production functions in capital reswitching .The main conclusion that a reader will come to is that the disparate and disputing subschools that make up the PK school have absolutely no clue as to how Keynes arrived at the conclusions he did since they accept the canard put out by Richard Kahn that Keynes was a poor mathematician since 1927.Various assorted PKers,such as Lorie Tarshis and G C Harcourt,have contributed mightily to the "What did Keynes really mean if we assume that he was rational?"debate,a debate which only calls into question the basic coherence of the PK school.This has naturally led to a chaotic situation.Unfortunately,King(K)lacks the mathematical skills(basic differential and integral calculus) needed to work out the technical analysis that John Maynard Keynes provided in chapters 10,20,21, and the appendix to chapter 19 of the GT, in order to rectify the situation.An understanding of the technical analysis worked out by A C Pigou in chapters 8-10,pp.86-102,Part II,of The Theory of Unemployment(1933)is a necessary prerequisite needed in order to understand the comparison-contrast that Keynes made in the appendix to chapter 19 of the GT between his model and Pigou's model.A reader who has covered the above mentioned chapters will be in a good position to discover that PK economics is essentially based on the 1954-1956 error filled Economic Journal exchange over Keynes's aggregate supply function carried on by Dennis Robertson,Ralph Hawtrey,de Jong,and Harry Johnson,who wrote an error filled mathematical appendix for Robertson,who was a self admitted mathematical illiterate.Three of the main founding fathers of PK economics,Sydney Weintraub,Douglas Vickers and Paul Davidson,simply adapted the Dennis Robertson-Harry Johnson case"iii-(a)"as their own.Unfortunately,the Robertson-Johnson model, in their case iii-a, contains three errors.The first error is that the expected aggregate supply function Z=g(N)=pO.On the contrary,Keynes defined ,in chapter 20,that his expected aggregate demand function D=pO,where p is an expected price and O=F(N) is an aggregate production function defined as such by Keynes on p.283 of the GT.Keynes's expected aggregate supply function is correctly specified as Z=P+wN,where P is defined by Keynes to stand for expected or future economic profit,w is a fixed or variable money wage,and N equals total aggregate employment.This result is easily obtained from pp.23-25 of the GT or by integrating the derivative specified by Keynes on pp.55-56,ft.2 or by integrating the derivatives specified by Keynes on pp.282-286 of the GT.The second error is the Robertson-Johnson claim that D=C+I.In chapters 5,6 and 10,Keynes specifies that Y=C+I.On page 209,Keynes further specifies that Y=PO,where,in the context of the Y-multiplier model of chapter 10,Y equals actual aggregate demand and P equals the actual price level.The third error is setting Z=pO=D=C+I,since the LHS is denominated in expected units while the RHS is denominated in actual units.Keynes's correct specification is D=pO=Z=P+wN.Both sides are correctly denominated in expected units.D=Z then specifies Keynes's aggregate supply curve,which is a locus of all possible pairs of expected prices and expected profits.The actual result,Y,will pick out one member of the set defined by D=Z.If mpc+mpi=1,there will be no involuntary unemployment(mpc equals the marginal propensity to spend on consumption goods while mpi equals the marginal propensity to spend on investment goods).If mpc+mpi<=1,some level of involuntary unemployment is present in the macroeconomy.All PKers accept and work with the mathematically incorrect and incoherent models of Davidson,Weintraub,and Vickers.The mathematical errors and misspecifications in their own models are the reason why the PKers have failed in their challenge to the orthodox schools of economics since 1960.