ABSTRACT
Jan Kregel provides a Post-Keynesian interpretation of Keynes in relation to Neoclassical theory. He rejects the idea that Keynes's theory is the Neoclassical model modified by the introduction of rigid wages and physical quantity adjustments. Instead Kregel shows how Keynes's understanding of uncertainty negates the self-adjusting mechanisms described by orthodox economists. Once Kregel establishes that the economy cannot restore equilibrium through price flexibility, he turns to the role of both real and monetary adjustments in accommodating economic disruption. To deal with the ever present uncertainty, financial markets and wage contracts develop, but even these cannot correct the instability generated by uncertainty.
