ABSTRACT
The introduction of the “finance motive,” shortly after the publication of The General Theory of Employment, Interest and Money, arose in connection with the debate on interest rate determination between Keynes, D.H. Robertson (1936, 1937, 1940) and Bertil Ohlin (1937a, b). This debate soon developed into the infamous “liquidity preference versus loanable funds” controversy (LP-LF). While Robertson thought that the two theories amounted to virtually the same thing, Keynes repeatedly insisted on the differences between them, thereby highlighting liquidity preference theory as a fundamental component of his General Theory.2
