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Quotation of the Day…

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… is from page 78 of Elizabeth S. Johnson’s and Harry G. Johnson’s 1978 book The Shadow of Keynes [2] (original emphasis):

At the level of scientific analysis, the outcome of the 1930s debates would have been far different – and twenty years of hard effort at re-synthesis rendered unnecessary – if Keynes had recognized, as he did in other contexts, that a major monetary disturbance injected by a major error of monetary policy (the decision to return to gold at an overvalued exchange rate after the First World War) was largely responsible for the mass unemployment be blamed on the separation of decisions to save from decisions to invest under capitalism, and if he had set himself to convince his professional colleagues that they were taking a theory designed for an economy in which wages and prices adjusted rapidly enough to maintain full employment and misapplying it to an economy in which severe monetary disturbance had made that assumption false, instead of setting out to demonstrate that that theory was wrong from the bottom up and that a new theory which he was providing was necessary for the understanding of reality.  But then there would have been no ‘Keynesian Revolution.’