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An Important Inconsistency at the Heart of the Standard Macroeconomic Model

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The Stock-Flow Consistent Approach

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Abstract

The standard neoclassical model is the foundation of most mainstream macroeconomics. Its basic structure dominates the analysis of macroeconomic phenomena, the teaching of the subject and even the formation of economic policy. And, of course, the modern quantity theory of money and its attendant monetarist prescriptions are grounded in the model’s strict separation between real and nominal variables.

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References

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Authors
  1. Wynne Godley
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  2. Anwar Shaikh
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Editor information

Editors and Affiliations

  1. Department of Economics, University of Ottawa, Canada

    Marc Lavoie (Professor) (Professor)

  2. Department of Economics, University of Cassino, Italy

    Gennaro Zezza (Professor) (Professor)

Copyright information

© 2012 Wynne Godley

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Godley, W., Shaikh, A. (2012). An Important Inconsistency at the Heart of the Standard Macroeconomic Model. In: Lavoie, M., Zezza, G. (eds) The Stock-Flow Consistent Approach. Palgrave Macmillan, London. https://doi.org/10.1057/9780230353848_4

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