The Hayek Literature: Nicholas Wapshott, Keynes Hayek: The Clash That Defined Modern Economics

Abstract

Opinion about the role government should play in the macroeconomy tends to conform to a rhythm, an ebb and flow, determined by circumstances and influenced by ideas. This book examines the ideas of John Maynard Keynes and Friedrich Hayek from the 1920s to the present, and concludes that interest in their theories and policy proposals waxed and waned according to changes in economic conditions. It is at once a study of the development of modern macroeconomic theory and policy, and a review of competing political philosophies. The author is a Reuters contributing columnist and former senior editor at The Times of London. He writes with an engaging style and adopts a light touch, calculated no doubt to attract a wide audience. The book, to be sure, is a good read. But historians of economic thought — and economists in general — will be disappointed perhaps with the superficial nature of much of the argument. Yet the book may assist the general reader to understand the evolution of economic ideas, as long as it is recognized that substantial liberties have been taken to simplify the argument.