
Contents
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Introduction Introduction
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The Mainstream View of the State and Public Policy The Mainstream View of the State and Public Policy
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A Post-Keynesian Critique of Mainstream Theory of the State and Public Policy A Post-Keynesian Critique of Mainstream Theory of the State and Public Policy
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Changes in Keynes’s Approach to Public Policy and the State Changes in Keynes’s Approach to Public Policy and the State
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Keynes’s Policy Recommendations Keynes’s Policy Recommendations
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The Role of the State The Role of the State
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The Neoclassical Response The Neoclassical Response
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Macro and Micro Public Investments Macro and Micro Public Investments
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Public Policy and Uncertainty Public Policy and Uncertainty
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Environmental Policy Environmental Policy
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Social Rationality Social Rationality
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Public Policy and Imperfect Markets Public Policy and Imperfect Markets
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Post-Keynesian Public Policy Method Compared to the Mainstream Post-Keynesian Public Policy Method Compared to the Mainstream
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Neoclassical Keynesians and Public Policy Neoclassical Keynesians and Public Policy
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The Evolution of Post-Keynesian Economics and Policy The Evolution of Post-Keynesian Economics and Policy
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Public Policy Tensions in Post-Keynesian Economics Today Public Policy Tensions in Post-Keynesian Economics Today
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Conclusion Conclusion
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Notes Notes
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References References
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14 The Post-Keynesian Critique of the Mainstream Theory of the State and the Post-Keynesian Approaches to Economic Policy
Get accessRichard P.F. Holt is Professor of Economics at Southern Oregon University, USA.
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Published:16 December 2013
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Abstract
One very important area where post-Keynesian economics differs from neoclassical economics is in public policy. Neoclassical economists believe in the efficacy of markets in most situations. As a result, they tend to oppose government interference in market economies. On the other hand, from a post-Keynesian perspective, it is not unusual for markets to fail. In such instances, government actions are necessary to improve economic performance and social welfare. Economic development and public policy should be based on improving the overall standard of living and should reflect the values and goals of equity and social justice as well as efficiency. This article provides a critique of the mainstream theory of the state by looking at the post-Keynesian responses to neoclassical economics and their approaches to public policy starting with the Great Depression. In mainstream economics, the state plays a minimal role. In contrast, post-Keynesians look at the state as playing an integral and vital role for the development and stability of markets and achieving sustainable economic growth.
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