Our intentions in writing this book are two. The first may command disagreement, but not disapproval. It is to place recent developments in macroeconomics into the context of the history of modern economic thought. This seemingly harmless pedagogical exercise, however, conceals a disturbing problem. Let us describe it in terms of the first-year graduate course in the history of economic thought that we have frequently co-taught.

The course covers two semesters, the first of which deals mainly with the dramatic scenarios of the Physiocrats, Smith, Ricardo, Marx, and Mill. This part of the course unfailingly captures the interest of its audience. Who can resist the appeal of these ventures in imaginative logic, in which sociological and political considerations interact with a market-constrained drive for capital to yield the varied trajectories of capitalism that the great economists foresaw?

The second semester begins with the formulations of Jevons, Edgeworth, and Walras. There is, initially, a sense of discontinuity as the narrower concerns of marginalism displace the broader objectives of classical thought, but the audience soon recognizes the underlying continuity of a new “chapter” in the ongoing history of economic thought. The new chapter is more finely analytical in style and less explicitly sociopolitical in content than its predecessor, but it also contains two attributes that legitimate its inclusion within the meta-narrative we call the history of economic thought. The first is an explicit concern for the relevance of its content to the “real” world.