How, and for How Long, Did Keynes maintain theTreatiseTheory?

Abstract

Many historians of economic theory have studied how John Maynard Keynes developed his theory fromA Tract on Monetary ReformthroughA Treatise on Money(hereafter theTreatise) toThe General TheoryofEmployment, Interest and Money(hereafter theGeneral TheoryorGT). After the pioneering studies by Moggridge (1973) and Patinkin (1976, 1982), there followed Dimand (1988), Amdeo (1989), Clarke (1988, 1998), Meltzer (1988), Moggridge (1992), Skidelsky (1992), Laidler (1999), and others. This is no wonder, for the Keynesian Revolution remains the most singular phenomenon that economic theory and policy have ever seen. Although the objective of our entire project has been to shed new light on this important and interesting phenomenon, examining and analyzing the processes of theory-building and rebuilding which constitute Keynes's intellectual journey (see Hirai 1997–99), the present paper focuses solely on one chapter in the long story of the transition through his three major works. The very fact of addressing the questions, “How did Keynes maintain the theory developed in theTreatiseafter its publication (October 1930), and for how long?” narrows the period under study to approximately two years which span roughly from October 1930 through October 1932. Our scrutiny will range over the original texts and primary material such as manuscripts, lecture notes, and correspondence produced over this period, and our findings will rest on the meticulous analysis of material of crucial importance for a clear understanding of Keynes's theoretical situation. We will also offer our comments on the earlier efforts insofar as they relate to the period in question.