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Quotations of the Day…

… are from John Eatwell’s 1987 essay “Keynesianism,” reprinted in John Eatwell, Murray Milgate, & Peter Newman, eds. The World of Economics (1991), pp. 367-370; this quotation is found on page 368:

[A]cceptance of Keynes’s argument implied rejection of the neoclassical theory of value and distribution in toto.


Eatwell goes on to point out, quite correctly, that Keynes conceded that the main tenets of neoclassical economics become valid – but are valid only – when there is full employment.  Here’s Eatwell again (also on page 368; original emphasis):

Keynes appears to rehabilitate the price mechanism as an efficient means of allocation, whilst at the same time denying its efficiency as a means of assuring full utilization of available factor services, even though these are two aspects of the same phenomenon.