The New Consensus and Post-Keynesian Interest Rate Policy
This paper outlines the fundamental arguments of the New Consensus, critiques it from a Post-Keynesian perspective, and offers a Post-Keynesian alternative to the Taylor Rule. While Post-Keynesian economics provides a theory of endogenous money with exogenous interest rates, it has no clear description of a central bank reaction function. We attempt to remedy this oversight by identifying some of the difficulties attached to developing a Post-Keynesian reaction function, and suggesting an approach to the setting of interest rates that is more consistent than the Taylor Rule with Keynes's General Theory.
Year of publication: |
2007
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Authors: | Gnos, Claude ; Rochon, Louis-Philippe |
Published in: |
Review of Political Economy. - Taylor & Francis Journals, ISSN 0953-8259. - Vol. 19.2007, 3, p. 369-386
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Publisher: |
Taylor & Francis Journals |
Saved in:
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