The General Theory of Transformational Growth
Keynes after Sraffa

This book attempts a comprehensive rethinking of economics, including a revision of methodology, redrawing the line between micro and macro.

Edward J. Nell (Author)

9780521590068, Cambridge University Press

Hardback, published 13 July 1998

816 pages, 69 b/w illus. 90 tables
23.8 x 16 x 5 cm, 1.2 kg

"Presents a theory of transformational growth that replaces equilibrium with history." Journal of Economic Literature

For the last century, economic analysis has been wedded to the idea of equilibrium, in spite of the evident fact that most economic relationships are in flux. The theory of transformational growth in this work replaces equilibrium with history. The role of the market is not to allocate resources, but to generate innovations, which are 'selected' by competition in an evolutionary process. These innovations in turn change the way markets work and how they adjust, thus creating new problems and new kinds of pressures to innovate. Different historical periods can be distinguished with a new one perhaps on the horizon. In each a distinctive style of technology prevails, associated with corresponding institutions and patterns of market behavior. The core relationships provide the foundations for a theory of monetary circulation, which makes possible a revised Keynesian approach, based on Classical foundations.

Preface
Acknowledgments
Part I. History or Equilibrium?: 1. The idea of transformational growth
2. The stylized facts of the old business cycle and the new
Part II. Method and Approach: The Active Mind: 3. Conceptual truths and empirical observation
4. Rationality, structure and behavior
Part III. Money and the Golden Rule: 5. Circulation and production: the need for money Appendix: recent theories of circulation
6. Circulation and instability: the supply of money
Part IV. The Wage-Profit Trade-Off: 7. The classical system: the Golden Rule, labor, and the wage-profit trade-off
Appendix: a numerical example
8. The classical system: gravitation and market adjustment
9. Cycles and growth: market adjustment in craft conditions
Part V. Investment and Mass Production: 10. Demand growth, pricing and investment plans
11. Inflation, employment, and market adjustment in mass production
Appendix: stability of the modes of operation
Part VI. Money and Fluctuations in the Modern Economy: 12. Money and interest in the Keynesian system
13. Growth and cycles: financially constrained instability under mass production
Appendix: Stability of modes of operation
Conclusions: 14. Keynesian themes on classical grounds
Bibliography
Index.

Subject Areas: Economic theory & philosophy [KCA]