Overview
- Builds a dynamic and analytical microeconomic foundation of The General Theory of Employment, Interest and Money
- Develops the concept of liquidity in relation to speculative bubbles and provides a rigorous framework for determining the meaning of the separation between ownership and management
- Provides an applicable theory to economies in reality, specifically to the current stagnant Japanese economy and to the Great Depression
- Includes supplementary material: sn.pub/extras
Part of the book series: SpringerBriefs in Economics (BRIEFSECONOMICS)
Part of the book sub series: Development Bank of Japan Research Series (BRIEFSDBJRS)
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Table of contents (10 chapters)
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Front Matter
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Reconsideration of The General Theory
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Front Matter
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Developing a New Collective Intelligence from The General Theory
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Front Matter
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Back Matter
Keywords
About this book
This book reconsiders Keynes’s The General Theory of Employment, Interest and Money and establishes a new interpretation. In contrast to the existing models, this book finds that the stickiness in the nominal wage is not crucial for his theory. Moreover, the author has also succeeds in capturing the concept of liquidity in a rigorous mathematical model. In conjunction with the development of the concept of liquidity, the separation of the decision between savings and capital investment, which plays a key role in the principle of effective demand and denies Say’s law, is exactly and originally formulated.
The theory thus developed is applicable to elucidating some serious political economic causes that entrap the long-stagnated Japanese economy. For example, an analytical explanation is provided about why disinflation/deflation incessantly progresses despite the exorbitant expansionary monetary policy (ijigen kin-yuu seisaku) by the Bank of Japan. This phenomenon is an unsolvable question from the quantity-theoretic approaches (e.g., monetarism and new Keynesianism) which, although they differ in assumptions concerning the length of adjustment periods, commonly assume that the price level sooner or later rises in proportion to the quantity of money.
Owing much to Keynes, the author’s approach considers that the price level is mainly governed by its marginal prime cost which is equal to the nominal wage as a first approximation. As such, the drastically sagging wages during the past 10 years provoke serious disinflation/deflation. It should be noted that this discussion never depends on the quantity of money.Authors and Affiliations
About the author
Bibliographic Information
Book Title: Keynes’s General Theory Reconsidered in the Context of the Japanese Economy
Authors: Masayuki Otaki
Series Title: SpringerBriefs in Economics
DOI: https://doi.org/10.1007/978-4-431-55915-3
Publisher: Springer Tokyo
eBook Packages: Economics and Finance, Economics and Finance (R0)
Copyright Information: Development Bank of Japan 2016
Softcover ISBN: 978-4-431-55913-9Published: 25 May 2016
eBook ISBN: 978-4-431-55915-3Published: 18 May 2016
Series ISSN: 2191-5504
Series E-ISSN: 2191-5512
Edition Number: 1
Number of Pages: XI, 98
Number of Illustrations: 19 b/w illustrations, 1 illustrations in colour
Topics: Macroeconomics/Monetary Economics//Financial Economics, Economic Theory/Quantitative Economics/Mathematical Methods