Economic Ideas in Political Time
The Rise and Fall of Economic Orders from the Progressive Era to the Global Financial Crisis

This book argues that intellectual stability causes recurrent market instability, tracing crises from the Great Crash to the Global Financial Crisis.

Wesley W. Widmaier (Author)

9781107150317, Cambridge University Press

Hardback, published 14 July 2016

274 pages
23.7 x 16 x 2.2 cm, 0.55 kg

Over the past century, the rise and fall of economic policy orders has been shaped by a paradox, as intellectual and institutional stability have repeatedly caused market instability and crisis. To highlight such dynamics, this volume offers a theory of economic ideas in political time. The author counters paradigmatic and institutionalist views of ideas as enabling self-reinforcing path dependencies, offering an alternative social psychological argument that ideas which initially reduce uncertainty can subsequently fuel misplaced certainty and crises. Historically, the book then traces the development and decline of the progressive, Keynesian, and neoliberal orders, arguing that each order's principled foundations were gradually displaced by macroeconomic models that obscured new causes of the Great Depression, Great Stagflation, and Global Financial Crisis. Finally, in policy terms, Widmaier stresses the costs of intellectual autonomy, as efforts to 'prevent the last crisis' have repeatedly obscured new causes of crises.

Part I. Theoretical and Historical Foundations: 1. Economic ideas in political time: construction, conversion, and crisis
2. The construction, conversion, and collapse of the progressive order
Part II. The Construction, Conversion, and Collapse of the Keynesian Order: 3. Constructing the Keynesian order: breaking finance and boosting labor
4. Converting the Keynesian order: toward the neoclassical synthesis
5. Constructing the Great Stagflation: from accommodation to transformation
Part III. The Construction, Conversion, and Collapse of the Neoliberal Order: 6. Constructing the neoliberal order: breaking labor and boosting finance
7. Converting the neoliberal order: toward the New Keynesianism
8. Constructing the Global Financial Crisis: from accommodation to iteration
Part IV. Conclusions: 9. Theoretical, historical and policy implications
Bibliography
Index.

Subject Areas: Economic history [KCZ], Political economy [KCP], Macroeconomics [KCB], Economic theory & philosophy [KCA]