Post-Keynesian modelling: where are we, and where are we going to?

Charles, Sébastien and Lang, Dany and Asensio, Angel (2010): Post-Keynesian modelling: where are we, and where are we going to?

Abstract

This paper presents the current “state of the art” of Post-Keynesian modelling, as well as the most important issues raised by it. We first present a new formal statement of the Keynes' model, highlighting the importance of the “static model of a dynamic process”, and insisting on the influence of “true uncertainty” and of the “views concerning the future.” The paper then analyses the three most important classes of Post-Keynesian contemporary models: the Kaleckian models of growth; the Minskian models showing the destabilizing impacts of financial variables on the economy; and the path-dependant models insisting on the nature of time in economics, and on the absence of any “natural” anchor. We argue that, whereas the current Post-Keynesian models have a lot in common with Keynes’ model, none of them encompasses all its rich and realistic properties, and a synthetic dynamic Post-Keynesian model is desirable, and has still to be framed. The main barriers to this synthesis are underlined.

• Item Type: MPRA Paper
• Language: English
• Keywords: Post-Keynesian modelling; Keynes’ “static model of a dynamic process”; Kaleckian models; Minskian models; Models of path dependency
• Subjects: E - Macroeconomics and Monetary Economics > E0 - General > E02 - Institutions and the Macroeconomy; E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E12 - Keynes ; Keynesian ; Post-Keynesian; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B40 - General; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E20 - General

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