Capitalism in the twentieth century was marked by periods of persistent bad performance alternating with episodes of good performance. A lot of economic research ignores this phenomenon; other work concentrates almost exclusively on developing technology as its cause. This 2001 book draws upon Schumpeterian, Institutional and Keynesian economics to investigate how far these swings in performance can be explained as integral to capitalist development. The authors consider the macroeconomic record of the developed capitalist economies over the past 100 years (including rates of growth, inflation and unemployment) as well as the interaction of economic variables with the changing structural features of the economy in the course of industrialization and transformation. This approach allows for changes both in the economic structure and in the economic variables to be generated within the system. This study will be essential reading for macroeconomists and economic historians.

‘In this well-structured book [the authors] present, in a wonderfully clear style, a framework that ‘explains’ the stylized facts of macroeconomic development of the industrial nations during the last 100 years. They consider these stylized facts in historical sequence, arguing that the facts trace out a pattern of alternating episodes of poor and superior macroeconomic performance. The framework they use is evolutionary; it is neither completely self-regulating nor knife-edge. The system adapts, but adapts slowly, to events and disturbances. Using their updated, evolutionary model, they explain the past and give us insight into the future. It is a sensible blend of institutional knowledge and analytic understanding. It is insightful, instructive, and will give the reader an excellent sense of what the real issues in macro are.’

David Colander - Middlebury College

‘I read this book with real satisfaction at a time when our discipline often appears so dismal … The sound construction of the book with the theories, the debates and the challenge of the data is reassuring … It reads as a classic in the same vein as Modern Capitalism and also dares to embark on institutional issues and evolutionary schemes.’

Pascal Petit - CEPREMAP, Paris

'The breadth of their research in this book is enormous … Because of this useful blend of economic theory, econometrics, economic history, and political-institutional analysis, one can quite correctly assert that this book has been written in the very best tradition of political economy.'

Source: Eastern Economic Journal

'The authors are to be congratulated for crafting a highly readable volume that combines a compelling account of recent capitalist history with contributions to the methods of evolutionary and Keynesian analyses. This book is essential reading for all who are interested in capitalist development and in the methods and application of non-mainstream macroeconomics.'

Source: Journal of Economic Issues