me: > > However, you never explain why the "Tract" wasn't essentially > > monetarist, which was deLong's point.
Ted: > Actually, I did. The ontological and psychological ideas to which I > pointed, e.g. the positing of an irrational "love of money" rooted in "deep > instincts," produce an understanding of the demand for money different from > "monetarism." I think I'll trust deLong's description, which suggests that these were rhetorical flourishes that hardly indicate any thinking different from the mainstream at the time. BTW, monetarist thinkers such as Patinkin put "real balances" into the individual utility functions that he posits, presuming that there was some direct benefit to us from holding money. This fits well with the idea that we have an irrational "love of money" rooted in "deep instincts." Not only that, but it saves the Walrasian system from the difficulties created by the role of money in the economy. > Thus, immediately preceding the claim that "in the long run we are all > dead," he points implicitly to the social ontological fact that social > relations are internal relations: > > "Every one admits that the habits of the public in the use of money and of > banking facilities and the practices of the banks in respect of their > reserves change from time to time as the result of obvious developments. > These habits and practices are a reflection of changes in economic and > social organisation." this was, and is, commonplace among neoclassicals. Obviously, "habits" vary with conditions, organization. It's not just individual choice, but the conditions under which they live. Neoclassical theory allows for "habits": they maximize utility over the long haul. > Immediately following the claim, he points, as examples of factors not > taken account of "by careless adherents of the quantity theory," to forms of > irrational hoarding. that's because, perhaps, he was a _careful_ adherent of the quantity theory at the time? I'm no expert on the history of economic thought, but I'd say that most of the time, Keynes' argument was not from outside the mainstream, but from the edges of it, despite the Fabian influences on his ideas. Even in the GT, he didn't see the deep role of class antagonism in capitalist society. He opposed the rentiers' influence at that time, but favored the industrial capitalists. > ... Keynes pointed particularly to the "bullionist complex" of the Bank of > France and Indian peasant hoarding as having these effects. an analysis of the psychology of the Bank of France seems to say nothing about the psychology of people operating on a day to day basis in the economy. what did he say about (Asian, I presume) Indian peasants? that they hoarded as a form of buying insurance and/or that they did so because they expected deflation? nothing new in either of those phenomena. Maybe if he had talked about "loss aversion" ... but he wrote several decades before experimental economics rose to the fore. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
