Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993

Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993

Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993

Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993

Synopsis

Though understandably preoccupied with the immediate problems of the Great Depression, the generation of economists that came to the forefront in the New Deal Era of the 1930s also looked ahead to the long-term consequences of the crisis and proposed various solutions to prevent its recurrence. Theodore Rosenof examines the long-run theories and legacies of four of the leading members of this generation: John Maynard Keynes of Great Britain, who influenced the New Deal from afar; Alvin Hansen and Gardiner Means, who fought over the direction of New Deal policy; and Joseph Schumpeter, an opponent of the New Deal.

Excerpt

The essential argument of this study is twofold. First, it is my contention that "long-run" or "evolutionary" concepts of economics, advanced during the New Deal Era to explain the Great Depression and out of vogue during the post-World War II boom, have reemerged since the early 1970s with the onset of a new era of long-run or "secular" economic dilemmas. It is my second contention that division within the camp of evolutionary, heterodox economists in and about the New Deal impeded a unified challenge to orthodoxy not only in the 1930s and early 1940s but also with implications and ramifications stretching into subsequent decades. A corollary point is that the long eclipse of a divided evolutionary economics also served to delimit interpretations of the New Deal's nature and to narrow understanding and utilization of its legacy.

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