ABSTRACT
The purpose of this book has been to analyze critically neoclassical macroeconomics as it is taught. The presentation went into considerable detail, and the reader might lave lost track of the basic message, especially in the political argument of the last chapter. The basic purpose was to refute the fundamental macroeconomic “parables” of neoclassical theory: (1) more employment requires a lower “real wage” (commodity wage); (2) increases in the price level are proportional to increases in the money supply; and (3) in an open economy with a flexible exchange rate monetary policy is effective and fiscal policy is ineffective.
