Intro -- Contents -- Preface -- 1 Economics before Keynes, I: Hume -- 2 Keynes at Versailles -- 3 Keynes and the Macmillan Committee -- 4 Economics before Keynes, II: Marshall -- 5 The General Theory -- 6 IS-LM Curves -- 7 The Liquidity Trap -- 8 Bretton Woods and the Swan Diagram -- 9 The...

We analyse optimal discretionary games between a benevolent central bank and a myopic government in a New Keynesian model. First, when lump-sum taxes are available and public debt is absent, we show that a Nash game results in too much government spending and excessively high interest rates,...