ABSTRACT
David Ricardo conquered England as completely as the Holy Inquisition conquered Spain," he resumed in The General Theory." While The General Theory is one of the greatest puzzles in the history of ideas, its basic statement is simple enough. It contended that the modern economy slipped into stagnation and unemployment because of defects in both its real and its monetary sectors. Keynes challenged neoclassical employment theory on the question of voluntary or involuntary employment. The neoclassicals argued rigorously that except for various anomalies and short-term situations, there was no such thing as involuntary unemployment. In essence, Keynes, putting his neoclassical training behind him, argued that an important part of what neoclassical economics called voluntary employment was actually involuntary. " The great puzzle of Effective Demand with which Thomas Malthus had wrestled vanished from economic literature." Reviving effective demand and confronting Say's Law, Keynes undertook his demonstration of the global imbalance of supply and demand.
