The Revival of Laissez-faire in American Macroeconomic Theory: A Case Study of the Pioneers
'I find the Revival of Laissez-Faire informative, especially as a survey of the ideas of the six economists, each of whom was no doubt at the front in the intellectual battle over laissez-faire. the book is a good source on an important slice of twentieth century economics for undergraduate history of economics course.' - J. Daniel Hammond, Journal of the History of Economic Thought In the 1970s, the Keynesian orthodoxy in macroeconomics began to break down. In direct contrast to Keynesian recommendations of discretionary policy, models advocating laissez-faire came to the forefront of economic theory. Laissez-faire no longer stood as an exceptional policy endorsed for rare occurrences of market clearing; rather it became the policy standard. This book provides the definitive account of this watershed and traces the evolution of laissez-faire using the cases of its proponents, Frank Knight, Henry Simons, Friedrich von Hayek, Milton Friedman, James Buchanan and Robert Lucas. By elucidating the pre-analytical framework of their writings, Sherryl Kasper accounts for the ideological influence of these pioneers on theoretical work, and illustrates that they played a primary role in founding the theoretical and philosophical use of rules as the basis of macroeconomic policy. A case study of the way in which interwar pluralism transcended to postwar neoclassicism is also featured.
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Henry Calvert Simons author of the blueprint
Friedrich von Hayek and the Austrian influence
Milton Friedman and monetarism
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action advocacy argued assumed assumption Austrian method became behavior believed Buchanan 1986b Buchanan and Wagner business cycle capital changes classical liberalism classical model competition concept decisions deficits demand developed discussion econometric economic activity economic theory effect empirical employment equilibrium ethical existing expectations hypothesis expected utility hypothesis fiscal institutions framework freedom Friedman 1953a Friedman and Savage Friedman and Schwartz ideas ideological individual inflation influence intellectual interwar J.B. Clark Keynesian economists Knight Knightian uncertainty knowledge laissez laissez-faire Lucas Lucas's macroeconomic ment methodological monetarism monetarist monetarist model monetary policy Mont Pelerin Society neoclassical economics nominal income organization output perfect competition philosophy Political Economy Positive Program postulate pre-analytic predictions problem production public choice theory public finance quantity theory rational expectations recommended response result revival of laissez-faire Road to Serfdom role scientific Simons and Hayek Simons's socialist structure theoretical tion uncertainty University of Chicago values viduals