| Abstract: |
The aim of this paper is to elucidate Keynes's Marshallian lineage. I argue
that the result of bringing out the Marshallian antecedents of the General
Theory highlights KeynesÕs failure to achieve the theoretical project he was
striving at, namely to demonstrate an involuntary unemployment result in the
arising of which nominal wage rigidity would play no role. In the first part
of the paper, I reexamine MarshallÕs theory of value. This sectionÕs main
conclusion is that no theory of unemployment is to be found in MarshallÕs
writings. In section two, I study the literature spanning from Marshall to
Keynes, focusing on Beveridge, Hicks and Pigou, in order to see whether the
lacuna present in MarshallÕs writings happened to be filled. Documenting the
emergence of the notion of frictional unemployment, I come to the conclusion
that its arising went along with little theoretical elaboration. The third and
last part of the paper is a critical reflection on the General Theory. I start
by making the point that KeynesÕs theory of effective demand ought to be
viewed as an extension of MarshallÕs analysis of firmsÕ short-period
production decisions. This enables me to bring out the decisive role played by
the wage rigidity assumption in KeynesÕs reasoning. I claim that, except for
this assumption, the differences between Ôeffective demand ˆ la MarshallÕ and
Ôeffective demand ˆ la KeynesÕ are minor. I close my analysis of KeynesÕs
reasoning by showing that no real removal of the nominal rigidity assumption
is to be found in chapter 19 of the General Theory. |