Yesterday David Fields — ofNaked Keynesianism — wondered what was my position on the fact that some heterodox economists would consider the IS-LM framework “to still be relevant if given enough flexibility without neoclassical synthesized elements.”
I will sure come back on this when time admits a more thorough analysis, but let me start by giving at least a tentative answer — focusing on where I think IS-LM doesn’t adequately reflect the width and depth of Keynes’s insights on the workings of modern market economies.What’s wrong with IS-LM?
Lars P. Syll | Professor, Malmo University
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