John Maynard Keynes, 1883 - 1946
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Civil servant
Pamphleteer
Don, Kings College
College Bursar
Editor, Economic Jrl
Company Chairman
– National Insurance Co.
• Patron of the Arts
– Bloomsbury
• Statesman
– Spokesman
– Advisor
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House of Lords
Bank of England
Lend Lease
Bretton Woods
Bloomsbury
The Memoir Club (painting by Vanessa Bell)
Clive Bell, Quentin Bell, Vanessa Bell, E.M. Forster,
David Garnett, Duncan Grant, J.M. Keynes, Lydia
Lopokova (Lady Keynes), Desmond MacCarthy, Mary
MacCarthy, Leonard Wolff
Duncan Grant, Keynes
Bertram Russell, Keynes, Lytton Strachey
Doing Economics: Math++
Professor Planck of Berlin, the famous
originator of the Quantum Theory, once
remarked to me that in early life he had
thought of studying economics, but had found
it too difficult! Professor Planck could easily
master the whole corpus of mathematical
economics in a few days. He did not mean
that! But the amalgam of logic and intuition
and the wide knowledge of facts, most of
which are not precise, which is required for
economic interpretation in its highest form,
is, quite truly, overwhelmingly difficult …
J. M. Keynes
Alfred Marshall, 1842-1924
Economic Journal, September 1924
p. 333 fn.
John Maynard Keynes (1883 – 1946): Major Works
•Indian Currency and Finance , 1913.
•The Economic Consequences of the Peace , 1919.
•A Treatise on Probability, 1921.
•Revision of the Treaty, 1922.
•A Tract on Monetary Reform, 1923.
•The Economic Consequences of Mr. Churchill, 1925.
•"Am I a Liberal?", 1925, N&A
•The End of Laissez-Faire, 1926
•"A Rejoinder to Ohlin's The Reparation Problem",
1929, EJ
•Can Lloyd George Do It? with H.D. Henderson, 1929.
•A Treatise on Money , two volumes, 1930.
•"Economic Possibilities for Our Grandchildren", 1930,
N&A and Saturday Evening Post.
•Essays in Persuasion, 1931
•Essays in Biography, 1933
•The Means to Prosperity, 1933.
•General Theory of Employment, Interest and
Money , 1936.
•"The General Theory of Employment", 1937, QJE
"Alternative Theories of the Rate of Interest", 1937, EJ
•"The Ex Ante Theory of the Rate of Interest", 1937, EJ
•"The Theory of the Rate of Interest", 1937, in Lessons
of Monetary Experience: In honor of Irving Fisher
•How to Pay for the War: A radical plan for the
Chancellor of the Exchequer, 1940.
•"Proposals for an International Clearing Union"
(Second Draft), 1941
“Europe Before the War”
from Economic Consequences of the Peace
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What an extraordinary episode in the economic progress of man
that age was which came to an end in August 1914! The greater
part of the population, it is true, worked hard and lived at a low
standard of comfort … But escape was possible, for any man of
capacity or character at all exceeding the average, into the
middle and upper classes, for whom life offered … conveniences,
comforts, and amenities beyond the compass of the richest and
most powerful monarchs of other ages. The inhabitant of London
could order by telephone, sipping his morning tea in bed, the
various products of the whole earth, in such quantity as he might
see fit, and reasonably expect their early delivery upon his
doorstep; he could at the same moment and by the same means
adventure his wealth in the natural resources and new
enterprises of any quarter of the world … ; or he could decide to
couple the security of his fortunes with the good faith of the
townspeople of any substantial municipality in any continent that
fancy or information might recommend.
Europe was so organised socially and economically as to secure
the maximum accumulation of capital. While there was some
continuous improvement in the daily conditions of life of the
mass of the population, society was so framed as to throw a
great part of the increased income into the control of the class
least likely to consume it. … Herein lay, in fact, the main
justification of the capitalist system … The immense
accumulations of fixed capital which, to the great benefit of
mankind, were built up during the half century before the war,
could never have come about in a society where wealth was
divided equitably.
Thus this remarkable system depended for its growth on a
double bluff or deception. On the one hand the labouring
classes accepted from ignorance or powerlessness, or were
compelled, persuaded, or cajoled by custom, convention,
authority, and the well-established order of society into
accepting, a situation in which they could call their own very
little of the cake that they and nature and the capitalists were cooperating to produce. And on the other hand the capitalist
classes were allowed to call the best part of the cake theirs and
were theoretically free to consume it, on the tacit underlying
condition that they consumed very little of it in practice.
Now perhaps we have loosed him (Malthus’ devil) again.
Keynes, A Skeptical Monetarist
• … an arbitrary doubling of [the money
stock], since this in itself is assumed not to
affect [the velocity of money or the real
volume of transactions] ... must have the
effect of raising [the price level] to double
what it would have been otherwise. The
Quantity Theory is often stated in this, or a
similar, form.
Now "in the long run" this is probably true.
But this long run is a misleading guide to
current affairs.
• In the long run we are all dead.
Economists set themselves too easy, too
useless a task if in tempestuous seasons
they can only tell us that when the storm
is long past the ocean is flat again.
• In actual experience, a change in [the
money stock] is liable to have a reaction
both on [the velocity of money] and on [the
real volume of transactions]...
John Maynard Keynes
A Tract on Monetary Reform