Summary
One of the major themes in contemporary economics is, as we have observed, theoretical priority of value theory as a foundation for macroeconomic analysis. A number of authors have clarified the influence of general equilibrium analysis on the work of Keynes, and have developed systematic reformulations of his ideas with this branch of pure theory as a point of departure. The tendency in this work has been to dismiss psychologically oriented hypotheses, such as those that were stressed by Keynes, as mereobiter dicta which at best serve to state an argument imprecisely in provisional form, and have no permanent role in rigorously formulated theory. An alternative view, which discards less of Keynes' macro methodology than much of modern exegesis, has been put forward in this paper.
A schema for macroeconomic theory which retains the utility and profit maximizing assumptions of pure theory, has been advanced. It has been called heterogeneous reduction of macroeconomics and is seen to find support in the literature of economics and the philosophy of science. Now that the necessity for developing the pure theory of macroeconomic activity is widely recognized, perhaps there is a greater opportunity for establishing a complementary role for behavioral hypotheses, whose current position of eclipse may one day be re-examined in a more favorable light.
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Fabian, R.G. Micro-and macroeconomic theory: The contested boundaries reconsidered. Atlantic Economic Journal 5, 11–21 (1977). https://doi.org/10.1007/BF02300306
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DOI: https://doi.org/10.1007/BF02300306