Monetary and financial Keynes theory: from the Treatise to the General Theory
Abstract
This paper explores the evolution of Keynes’s monetary and financial theory from “A Treatise on Money” to “The General Theory of Employment, Interest, and Money.” It highlights the autonomy of the monetary interest rate from savings and its implications for investment blockages, a key feature distinguishing Keynesian theory from classical economics. The study delves into the transition from a monetary and financial theory of interest to a purely monetary theory, emphasizing the role of the interest rate in the economy and its impact on investment and unemployment. By examining the additions and abandonments from the Treatise to the General Theory, this paper contributes to understanding Keynes’s development of a monetary theory of unemployment, which remains relevant in contemporary economic discussions, particularly in light of the 2008 financial crisis.