ABSTRACT
Over the years, both internal and external challenges to heterodox macroeconomic theory have pushed that theory in new directions. A subset of these developments, in response to some of the more serious challenges, has resulted in a much improved integrated heterodox approach based on the original contributions of Keynes, Marx and early institutionalists. The result is an integrated theory that is more coherent, logically consistent, realistic, flexible and capable of explaining modern macrodynamics in historical time. This new integrated approach is the subject matter of this book. We call this unification of alternative macro perspectives the “secondgeneration integration.” The first integration occurred shortly after Keynes’ seminal work and lasted into the early 1970s. Since the end of that period, a richer and more complete integration has gradually emerged with many important innovations not appearing until the 1990s and later. Given these recent extensions and the lack of a volume that reflects on those innovations, the purpose of the original papers in this book is to familiarize the reader with the emerging unified theory of heterodox macroeconomics and its applications. The second-generation integration overcomes the stagnation that occurred in the unification of heterodox perspectives as a direct result of divisions that emerged from the first integration (internal challenge). In retrospect, the earlier integration merely generated a set of core heterodox general principles (Sawyer (Chapter 2)) and a critique of mainstream theory, but was incapable of gendering consensus concerning key behavioral relations that explain macroeconomic evolution. While the goal of this book has not been to develop a fully agreed upon model, the chapters within reconsider core principles and make some important progress on developing core behavioral micro and macro relations. The fundamental distinction between this second integration and the earlier one is the transition from common core principles to common behavioral relations. It is often and understandably stated that it is easier to know what heterodox macroeconomics is not than to know what that doctrine is. This book helps to resolve this problem by overcoming previous impediments to an identifiable unified body of heterodox macroeconomics and by further branding/extending that unified theory.
