ABSTRACT
In this chapter we shall consider the subsequent evolution of the Neoclassical Synthesis in the 1950s by focusing on significant works of the leading American Keynesians-Hansen, Modigliani, Brumberg, Ackley and Tobin. While continuing to regard macroeconomics as an essentially pragmatic discipline, these authors suggest some important changes in the application of the general equilibrium canons with respect to the standard interpretations of the 1940s. First, while agreeing with the process of translation of the General Theory in terms of direct forces which came into being after its publication, they find that this process must be pushed one stage further. They advocate, in particular, a more explicit consideration of expectations and uncertainty in the analysis of the saving-investment relationship. Second, they become aware that this task implies calling into question Klein’s simple aggregation view. American Keynesians argue, for example, that Keynes’s concepts must be amended in the light of modern theory. Moreover, in their view, more sophisticated micro theories than those used by Klein are needed to account for macro issues.
