Demand Side Economics

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A new book called Demand Side Eco­nom­ics, by Alan Har­vey, has been released. It deal­ing with some of the vision­ary thinkers behind chang­ing con­ven­tion­al eco­nom­ic the­o­ry for the bet­ter.

Alan intro­duces the book say­ing:

The pur­pose of this book is to lay out an eco­nom­ics that makes sense of his­to­ry, includ­ing the rev­o­lu­tion­ary his­to­ry of the present time. This “Demand Side” eco­nom­ics is not new. It was orig­i­nat­ed and devel­oped by the great British econ­o­mist John May­nard Keynes and by the acolytes of the prag­mat­ic pro­grams of the New Deal. It is called Demand Side eco­nom­ics because demand is the fun­da­men­tal dri­ver of eco­nom­ic progress and con­straint in eco­nom­ic stag­na­tion. The orga­ni­za­tion of demand is the orga­ni­za­tion of the econ­o­my. What is demand­ed is what is sup­plied, in scale and in selec­tion. Employ­ment, invest­ment, growth and devel­op­ment occur along the path of what is demand­ed. That demand can be for pub­lic or pri­vate goods. We describe and dis­play the demand side frame­work by fol­low­ing its devel­op­ment through the thought of a series of influ­en­tial econ­o­mists, begin­ning with Keynes and end­ing with Steve Keen and Nouriel Roubi­ni. Through their work, con­cepts and ana­lyt­i­cal tools we can look in on the devel­op­ment of the mod­ern econ­o­my since 1930.’

Chap­ter 11 is Steve’s fea­ture chap­ter enti­tled, Steve Keen and the Great Reces­sion, open­ing with a quote:

The main con­straint fac­ing cap­i­tal­ist economies is not sup­ply, but demand.’

Steve Keen

Alan accred­its Steve’s demand side think­ing to an under­stand­ing of Hyman Min­sky’s Finan­cial Insta­bil­i­ty Hypoth­e­sis and my back­ground train­ing in math­e­mat­ics. Sug­gest­ing that Steve;

…took advan­tage of the most advanced com­put­er­ized dynam­ic mod­el­ing soft­ware and pro­duced remark­ably accu­rate pre­dic­tions from assump­tions derived and devel­oped from Min­sky. The gen­er­al equi­lib­ri­um mod­el of most fore­cast­ers, even after decades of devel­op­ment, pro­duces lit­tle more than noise.’

For more infor­ma­tion, vis­it the Demand Side Eco­nom­ics web­site.

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About Steve Keen

I am Professor of Economics and Head of Economics, History and Politics at Kingston University London, and a long time critic of conventional economic thought. As well as attacking mainstream thought in Debunking Economics, I am also developing an alternative dynamic approach to economic modelling. The key issue I am tackling here is the prospect for a debt-deflation on the back of the enormous private debts accumulated globally, and our very low rate of inflation.