ABSTRACT
The recent crisis has reminded us that there is more to macroeconomic instability than price level fluctuations, and that monetary theory must explain more than the inflation rate. Some economists – for example George Akerlof and Robert Shiller (2009) and Paul Krugman (2009) – have recently turned to earlier literature for inspiration here: a good idea, except that they have tended to treat John Maynard Keynes’s General Theory of Employment, Interest and Money (1936) as if it alone was a reliable repository of earlier wisdom. This essay’s dedicatee, Harald Hagemann, has himself done much over the years to demonstrate that economists had a lot to say about crises even before 1936 that did not find its way into the General Theory but is valuable nevertheless, and I hope that this rather selective survey of some of their work, both as history and as a source of insights into current problems, is a worthy tribute to his accomplishments.
