Abstract
The most important intellectual product of the Great Depression was Keynes’s General Theory, which was published in 1936. It was not totally original, nor did it present an entirely consistent and self-contained theoretical system. Many of its ideas had been anticipated by earlier writers (including Keynes himself) and there were, as we shall see, important analytical lacunae. Even the policy prescriptions which the General Theory contained were less novel, and less controversial, than is often supposed. Moreover Keynes never broke decisively with orthodox theories, and incorporated a number of important neoclassical ideas into his own work.1 All the same, the book was the first systematic and comprehensive expression of the view that mass unemployment was the normal outcome of an unregulated capitalist economy to emerge from the pen of a respected and hitherto mainstream economist, and as such its appearance was a major event which Marxian theorists could not ignore.2 Moreover, Keynes’s ideas offered the prospect of a reformed, crisis-free capitalism in which Marxian economics would become an irrelevance, so that there were direct political implications to be faced. The bulk of this chapter is concerned with the ways in which Marxian political economy responded to the Keynesian challenge. We begin, however, by asking the converse question: what did Keynes make of Marx?
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Notes
M. Bleaney, The Rise and Fall of Keynesian Economics (London: Macmillan, 1986), Chs 1–2
J. Robinson, Economic Philosophy (Harmondsworth: Penguin, 1964)
Robinson, Economic Heresies (London: Macmillan, 1971); see also Ch 15 below.
Kurt Mandelbaum and Friedrich Pollock, writing under the joint pseudonym of ‘Erich Baumann’, regarded Keynes’s attack on ‘classical economics’ as the twentieth-century equivalent of J.S. Mill’s recantation of the wage-fund theory in 1869: E. Baumann, ‘Keynes’s Revision der Liberalistischen Nationalökonomie’, Zeitschrift far Sozialforschung, 5, 1936, p. 384
J.M. Keynes, The General Theory of Employment, Money and Interest (London: Macmillan, 1936), p. 3n.
Ibid, pp. 32, 355. On Douglas, see H.I. Dutton and J.E. King, ‘“A Private, Perhaps, but not a Major ...”: the Reception of C.H. Douglas’s Social Credit Ideas in Britain, 1919–1939’, History of Political Economy, 16, 1986, pp. 259–79
on Gesell see H.T.N. Gaitskell, ‘Four Monetary Heretics’, in G.D.H. Cole (ed.), What Everyone Wants to Know About Money (London: Gollancz, 1933), pp. 385–401.
M.H. Dobb, ‘Random Biographical Notes’, Cambridge Journal of Economics, 2, 1978. p. 117.
J.M. Keynes, ‘The End of Laissez-Faire’ (1926), in Keynes, Collected Works, volume IX (London: Macmillan for the Royal Economic Society, 1972) (hereafter CW), p. 285; cf. his review of Trotsky’s Where Is Britain Going? (1926 in CW, X (1972)), pp. 63–7.
Keynes, 1933 draft of the General Theory in CW, XXIX (1979), pp. 81 and 81n. On Hobson see J.E. King, Economic Exiles (London: Macmillan, 1988), Ch. 6; on Foster and Catchings
see J. Dorfman, The Economic Mind in American Civilisation, volume 4 (New York: Viking Press. 1959) pp. 338–51.
Keynes to G.B. Shaw, 2 December 1934 and 1 January 1935, in CW, XXVIII (1982), pp. 38, 42; cf. D.K. Foley, ‘Say’s Law in Marx and Keynes’, Cahiers d’Économie Politique, 10–11, 1986, pp. 183–94.
L. Corey, The Decline of American Capitalism (London: John Lane The Bodley Head, 1935), pp. 188–90, 214–16; cf. Ch. 1, section II, above.
E. Lederer, ‘Commentary on Keynes’, Social Research, 3, 1936, pp. 478–87.
On Lederer see R.A. Dickler, ‘Lederer, Emil (1882–1939)’, in J. Eatwell, M. Milgate and P. Newman (eds), The New Palgrave: A Dictionary of Economics, volume 3 (London: Macmillan, 1987) pp. 157–8.
Ibid, p. 487. Very similar points were raised by the then Social Democrat A.L. Rowse in his Mr Keynes and the Labour Movement (London: Macmillan, 1936), pp. 12–13, 17, 56–61.
J. Darrell, ‘The Economic Consequences of Mr. Keynes’, Science and Society, 1, 1937, pp. 194–211.
E. Roll, ‘The Decline of Liberal Economics’, Modern Quarterly, 1, 1938, pp. 78–90.
J. Strachey, ‘Mr. J.M. Keynes and the Falling Rate of Profit’, Modern Quarterly, 1, 1938, pp. 337–47.
See also N. Thompson, ‘John Strachey: the Making and Unmaking of an English Marxist, 1925–40’, in D.E. Moggridge (ed.), Perspectives on the History of Economic Thought, Volume 3 (Aldershot: Edward Elgar, 1990), pp. 103–16.
J.D. Wilson, ‘A Note on Marx and the Trade Cycle’, Review of Economic Studies, 5, 1938, pp. 107–13
Fan-Hung, ‘Keynes and Marx on the Theory of Capital, Accumulation, Money and Interest’, Review of Economic Studies, 7, 1939, pp. 28–41, reprinted in D. Horowitz (ed.), Marx and Modern Economics (London: McGibbon & Kee, 1968), pp. 117–37
E.E. Ward, ‘Marx and Keynes’s General Theory’, Economic Record, 15, 1939, pp. 152–67
O. Lange, ‘Marxian Economics and Modern Economic Theory’, Review of Economic Studies, 2, 1935, pp. 189–201.
Dobb, ‘Random Notes’, p. 119; A. Robinson, ‘Keynes and His Cambridge Colleagues’, in D. Patinkin and J.C. Leith (eds), Keynes, Cambridge and the ‘General Theory’ (London: Macmillan, 1937), p. 27.
Dobb, review of Keynes’s Treatise, Cambridge Review, 28 November 1930, reprinted in E. Homberger, W. Janeway and S. Schama (eds), The Cambridge Mind: Ninety Years of the ‘Cambridge Review’ (London: Cape, 1970), pp. 44–6; Russian Economic Development Since the Revolution (London: Routledge, 1928), p. xii
Dobb, ‘Employment And Unemployment’ (a review of Joan Robinson’s Introduction To The Theory Of Employment), Cambridge Review, 28 January 1938, pp. 213–14
Dobb, ‘An Economist From Poland’ (review of Kalecki’s Essays In The Theory of Economic Fluctuations), Daily Worker, 22 March 1939
Dobb, Political Economy and Capitalism (London: Routledge, 1937; 2nd edn, Routledge & Kegan Paul, 1940). We are grateful to Noel Thompson and especially to Brian Pollitt for information concerning Dobb’s attitude to the General Theory.
J. Robinson, Essays in the Theory of Employment (London: Macmillan, 1937), pp. v and 246–55
Robinson, ‘Marx on Unemployment’, Economic Journal, 51, 1941, pp. 234–48
Robinson, An Essay on Marxian Economics (London: Macmillan, 2d edn, 1966; first published 1942), p. vi.
M.C. Howard and J.E. King, The Political Economy of Marx (Harlow: Longman, 1985), 2d edn, pp. 209–14.
Ibid, p. 240; cf. M. Kalecki, Essays in the Theory of Economic Fluctuations (London: Allen & Unwin, 1939), p. 45
H. Smith, ‘Marx and the Trade Cycle’, Review of Economic Studies, 4, 1937, pp. 192–204.
S.S. Alexander, ‘Mr. Keynes and Mr. Marx’, Review of Economic Studies, 7, 1940, pp. 123–35.
L.R. Klein, ‘Theories of Effective Demand and Employment’, Journal of Political Economy 55, 1947, pp. 108d–32, reprinted in Horowitz, Marx, pp. 138–75.
S. Tsuru, ‘Keynes Versus Marx: The Methodology of Aggregates’, in K. Kurihara (ed.), Post Keynesian Economics (New Brunswick, NJ: Rutgers University Press, 1954), pp. 320–44, reprinted in Horowitz, Marx, pp. 176–202
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cf. E.S. Domar, Essays in the Theory of Economic Growth (New York: Oxford University Press, 1957) Ch. IX.. and Ch. 15 of volume I of this book.
D. Dillard, ‘Keynes and Marx: a Centenary Appraisal’, Journal of Post-Keynesian Economics, 6, 1984, pp. 421–32
cf. P. Kenway, ‘Marx, Keynes and the Possibility of Crisis’, Cambridge Journal of Economics, 4, 1980, pp. 23–36
C. Sardoni, Marx and Keynes on Economic Recessions; The Theory of Unemployment and Effective Demand (Brighton: Wheatsheaf, 1987).
P. Burkett, ‘Dillard on Keynes and Marx: Comment’, Journal of Post-Keynesian Economics, 8, 1986, pp. 623–31
cf. D. Dillard, ‘Dillard on Keynes and Marx: Rejoinder’, Journal of Post-Keynesian Economics, 8, 1986, pp. 632–6.
Keynes, Essays in Persuasion, in CW, IX (1972), p. vii; cf. his comments on Trotsky, cited in n.6 above.
P.M. Sweezy, ‘John Maynard Keynes’, Science and Society, 10, 1946, pp. 398–405, reprinted in Sweezy, The Present as History (New York: Monthly Review Press, 1953), pp. 253–62. On Hilferding, see Ch. 5 of volume I of this book.
M.H. Dobb, ‘Full Employment and Capitalism’ (1950), in Dobb, On Economic Theory and Socialism (London: Routledge & Kegan Paul, 1955), pp. 215–25
Dobb, Theories of Value and Distribution Since Adam Smith (Cambridge: Cambridge University Press, 1973), p. 225
cf. J.M. Gillman, ‘An Evaluation of John Maynard Keynes’, Science and Society, 19, 1955, pp. 107–33
and M.A. Lebowitz, ‘The Current Crisis of Economic Theory’, Science and Society, 37, 1973–4, pp. 385–403.
M. Kalecki, ‘Political Aspects of Full Employment’, Political Quarterly, 14, 1943, pp. 322–31
reprinted in E.K. Hunt and J.G. Schwartz, (eds), A Critique of Economic Theory (Harmondsworth: Penguin, 1972), pp. 420–30.
P. Mattick, Marx and Keynes: the Limits of the Mixed Economy (London: Merlin, 1971), and Ch. 16 of volume I of this book.
B. Fine and L. Harris, Re-Reading Capital (London: Macmillan, 1979)
and G. Pilling, The Crisis of Keynesian Economics (Beckenham: Croom Helm 1986).
The parallels here with conservative writers such as Bacon and Eltis are conceded by Pilling, Crisis, p. 131 (see R. Bacon and W. Eltis, Britain’s Economic Problem: Too Few Producers, London, Macmillan, 1976).
M. Kalecki, ‘The Marxian Equations of Reproduction and Modern Economics’, Social Science Information 7, 1968, pp. 73–9
reprinted in J.B. Foster and H. Szlajfer (eds), The Faltering Economy (New York: Monthly Review Press, 1984), pp. 159–66
cf. J. Steindl, Maturity and Stagnation in American Capitalism (New York: Monthly Review Press, 1976; first published 1953), pp. 236–9
P. Erdos, ‘A Contribution to the Criticism of Keynes and Keynesianism’, in J.G. Schwartz (ed.), The Subtle Anatomy of Capitalism (Santa Monica, Cal.: Goodyear, 1977), pp. 232–54; and
M. Sebastiani (ed), Kalecki’s Relevance Today (London: Macmillan, 1989), pp. 164–90, 206–19.
For a discussion of the wider relationship between Kalecki and Marx see M. Sawyer, The Economics of Michal Kalecki (London: Macmillan, 1985), Ch. 8.
J. Robinson, ‘What Has Become of the Keynesian Revolution?’, in Robinson, Collected Economic Papers, volume V (Oxford: Blackwell, 1979), pp. 168–77
R.E. Lucas, Studies in Business Cycle Theory (Cambridge, Mass.: MIT Press, 1981); cf. Dobb, Theories, pp. 214–5.
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© 1992 M. C. Howard and J. E. King
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Howard, M.C., King, J.E. (1992). Marx and Keynes. In: A History of Marxian Economics. Radical Economics. Palgrave, London. https://doi.org/10.1007/978-1-349-21890-5_5
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