ABSTRACT
The General Theory has suffered the fate of all books, revolutionary in their time. It is now an unread ‘classic’. I set out to produce a ‘theory of output as a whole’, the absence of which I identified as the main gap in classical economics. The need to treat output as the variable to be explained arose because of the tendency of capitalist economies to experience prolonged periods of sub-normal activity. But there is nothing in my theory formally inconsistent with the view that capitalist economies may spontaneously experience long periods of satisfactory employment on average, in which case no special measures of government intervention are necessarily called for. For this reason, my ‘general theory’ is more properly regarded, like Marshall’s Principles, as an ‘organum of thought’, a framework for thinking about aggregate problems, a statement of logical possibility, rather than as a proof that unmananged capitalist economies are inevitably demand-constrained. What I was asserting is that the limiting case when involuntary unemployment is absent cannot be the general case in an economy where contracts, or debts, are fixed in money terms, and economic agents are free to refrain from spending.
