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General theorising and historical specificity: Hodgson on Keynes

Published online by Cambridge University Press:  27 March 2019

Rod O'Donnell
Rod O'Donnell*
Affiliation:
University of Technology Sydney, Sydney, Australia
*
*Corresponding author. Email: rod.odonnell@uts.edu.au
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Abstract

In relation to Keynes's thought on general theorising, consumption theory and institutions, this paper closely examines Geoff Hodgson's views as set out in his magisterial work, How Economics Forgot History. While in full agreement with its advocacy of the institutionalist programme, it finds that Keynes's position has been misunderstood in all three areas, and that deep compatibilities exist between the General Theory and institutionalist analysis. Using all his available writings, it is argued that Keynes's conception of a general theory is very different from that underpinning neoclassical economics so that criticisms of the latter are irrelevant to the former, that Keynes's ‘fundamental psychological law’ was never advanced as a universal law applicable to all economies, and that Keynes expressly analysed a historically specific economic institution and its assemblage of sub-institutions. Keynes is an ally, not an enemy, of institutionalism in pursuing better economic theory.

Keywords

Keynesgeneral theorisinghistorical specificityinstitutionalism

Information

Type
Research Article
Information
Journal of Institutional Economics , Volume 15 , Issue 4 , August 2019 , pp. 715 - 731
Copyright
Copyright © Millennium Economics Ltd 2019 

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