The General Theory of Employment, Interest, and Money

By: Keynes, John Maynard

Price: $750.00

Quantity: 1 available

Book Condition: Very Good

First American edition: $2.00 jacket price, erratum on p. 403, blue cloth with gilt titles (later printings had black cloth with orange titles). Includes scarce jacket. Aldine Publishing Company prospectus for Milton Friedman's Price Theory laid in. Jacket edges rubbed with a few small chips and closed tears, jacket flap corners slightly trimmed (price still intact), minor pencil underlining and marginalia, probably from previous owner whose name and date are in ink on front endpaper (Edward Peragalt [?] 11/24/37). 1936 Hard Cover. xii, 403 pp. 8 1/2 x 5 3/4. No copyright date listed. Original black cloth, gilt titles. The General Theory of Employment, Interest and Money was written by the English economist John Maynard Keynes. The book, generally considered to be his magnum opus, is largely credited for creating the terminology of modern macroeconomics. Published in February 1936 it sought to bring about a revolution, commonly referred to as the Keynesian Revolution, in the way economists thought and especially in relation to the proposition that a market economy tends naturally to restore itself to full employment after temporary shocks. Regarded widely as the cornerstone of Keynesian thought, the book attacked the established classical economics based upon laissez-faire and introduced important concepts such as the consumption function, the multiplier, the marginal efficiency of capital and liquidity preference. Although The General Theory was written in the aftermath of the Great Depression and was taken by many to justify the assumption by government of the responsibility for the achievement and maintenance of full employment, it is for the most part a highly abstract work of theory and by no means a tract on policy. Its full meaning and significance continues to be debated even today. As a book, it is a difficult read for a modern student of economics, although it is enlivened by some brilliant rhetorical passages, including the description of the stock market in Chapter 12 and the concluding chapter 24 on the (rather tentative) policy implications Keynes derived from his theory. Contrary to popular belief, Keynes was by no means the first to advocate public works or deficit spending in a depression, but his book provides the theoretical framework within which temporary measures like the New Deal and longer term commitments to the welfare state can be justified. Keynes himself placed equal emphasis on redistributive taxation and a monetary policy of cheap money as well as fiscal policy, and he did not believe governments should run deficits for current consumption, as opposed to public investment. He was by no means a socialist in the usual sense and did not advocate big government for its own sake. The central argument of the book is that the level of employment is determined, not by the price of labour as in neoclassical economics, but by the spending of money (aggregate demand). He argues that it is wrong to assume that competitive markets will, in the long run, deliver full employment or that full employment is the natural, self-righting, equilibrium state of a monetary economy. On the contrary, under-employment and under-investment are likely to be the natural state unless active measures are taken. Although few modern economists would disagree with the need for at least some intervention, policies such as labour market flexibility are underpinned by the neoclassical notion of equilibrium in the long run. The implication of The General Theory is that a lack of competition is not the fundamental problem and measures to reduce unemployment by cutting wages or benefits are not only hard-hearted but ultimately futile. Keynes does not set out a detailed policy program in The General Theory, but he went on in practice to place great emphasis on the reduction of long-term interest rates and the reform of the international monetary system as structural measures needed to encourage both investment and consumption by the private sector. Just as the reception of The General Theory was encouraged by the 1930s experience of mass unemployment, its fall from favour was associated with the stagflation of the 1970s. Although Keynes explicitly addresses inflation, The General Theory does not treat it as an essentially monetary phenomenon nor suggest that control of the money supply or interest rates is the key remedy for inflation. This conflicts both with neoclassical theory and with the experience of pragmatic policy-makers. Furthermore the main Keynes

Title: The General Theory of Employment, Interest, and Money

Author: Keynes, John Maynard

Categories: Business & Economics,

Edition: First American Edition

Publisher: New York, Harcourt, Brace and Company: 1936

Binding: Hard Cover

Book Condition: Very Good

Jacket Condition: Good

Seller ID: 2306027