ABSTRACT
When Keynes’ The General Theory was published in 1936, the first reaction it elicited was perplexity. Pigou, who admittedly had reasons to be prejudiced against it, found it ‘barely intelligible’ ([1936] 1983: 21). Yet he was scarcely alone in holding this opinion. Many of those who were to become fully-fledged Keynesians shared it. As noted by Young:
The majority of ‘working economists’, however, seemingly did not know how to digest Keynes’ new book and remained in a state of what may be called ‘conceptual inertia’ until the IS-LM approach was expounded in the papers of Harrod, Hicks and Meade.
