Approches_Eco_Anal_Cours_2013

SOME INTRODUCTORY REMARKS........................................................................................................

2

CHAPTER I. PRE-CLASSICAL AND CLASSICAL ECONOMICS......................................................

12

1. MERCANTILISM, THE 18TH–CENTURY PREDECESSORS AND PHYSIOCRACY ...............................................

12

1.

1.

The balance-of-trade doctrine and the specie-flow mechanism.....................................................

12

1.

2.

The mercantilist dilemma, the quantity theory of money and Cantillon ........................................

16

1.

3.

Money and the rate of interest ......................................................................................................

18

1.

4.

The meaning of physiocracy, the Tableau Economique and the premises of the Laissez-Faire ....

19

2. THE SMITHIAN ECONOMICS .....................................................................................................................

22

2.

1.

The invisible hand ..........................................................................................................................

23

2.

2.

Accumulation, distribution and value ............................................................................................

24

2.

3.

Market and competition .................................................................................................................

25

3. POPULATION AND DIMINISHING RETURNS ................................................................................................

27

3.

1.

Malthus’s analytical schema..........................................................................................................

28

3.

2.

The law of diminishing returns ......................................................................................................

28

3.

3.

The Ricardian system .....................................................................................................................

29

3.

4.

Ricardo on foreign trade................................................................................................................

31

4. SAY AND MILL.........................................................................................................................................

32

4.

1. Say’s law ........................................................................................................................................

32

4.

2.

Dichotomisation and the quantity theory of money .......................................................................

34

4.

3.

John Stuart Mill and Principles of Political Economy (1848) .......................................................

36

4.

4.

The Currency School-Banking School controversy........................................................................

37

5. THE ECONOMICS OF KARL MARX............................................................................................................

39

CHAPTER II. THE MARGINAL REVOLUTION AND NEO-CLASSICAL ECONOMICS ..............

42

1. EMERGENCE OF MARGINAL UTILITY ........................................................................................................

42

1.

1.

The neoclassical method and the maximisation principle..............................................................

42

1.

2.

The theory of exchange: Jevons, Walras and Menger ...................................................................

45

1.

3.

Cournot as the forerunner of the neoclassicism.............................................................................

49

2. MARSHALLIAN ECONOMICS .....................................................................................................................

50

2.

1.

Utility and measurability ...............................................................................................................

50

2.

2.

Competition and equilibrium .........................................................................................................

51

2.

3.

Periods, costs and external economies ..........................................................................................

53

3. THE MARGINAL PRODUCTIVITY ...............................................................................................................

55

3.

1.

A theory of distribution ..................................................................................................................

55

3.

2.

Entrepreneur and profit: risk, uncertainty, and innovation ...........................................................

56

4. THE DEVELOPMENT OF THE NEOCLASSICAL THEORY ...............................................................................

57

4.

1.

The Austrian School: the subjectivism ...........................................................................................

57

4.

2.

From marginalist theory of distribution to the Wicksellian monetary theory ................................

59

4.

3.

Utility: cardinalism or ordinalism? ...............................................................................................

60

4.

4.

Pareto optimality and welfare economics ......................................................................................

61

CHAPTER III: INTRODUCTION TO THE KEYNESIAN ECONOMICS ...........................................

64

1. THE THEORETICAL FEATURES OF THE KEYNESIAN REVOLUTION .............................................................

64

2. THE EFFECTIVE DEMAND AND THE INVESTMENT......................................................................................

66

2.

1.

Expenditure decisions ....................................................................................................................

66

2.

2.

The investment multiplier...............................................................................................................

67

3. THE LIQUIDITY PREFERENCE ....................................................................................................................

69

CHAPTER IV: FROM NEOCLASSICAL MACROECONOMICS TO NEW KEYNESIAN

CRITIQUES ..................................................................................................................................................

72

1. MONETARISM AND THE NEW CLASSICAL ECONOMICS .............................................................................

72

1.

1.

Monetarism as the revival of the quantity theory of money ...........................................................

72

1.

2.

Phillips curve, natural rate of employment and the rational expectations ....................................

74

2. BUSINESS CYCLES AND MARKET IMPERFECTIONS....................................................................................

82

2.

1.

Real Business Cycle theory ............................................................................................................

82

2.

2.

Supply-side economics ...................................................................................................................

84

3. OPTIMAL ECONOMIC POLICIES: CONDUCT BY RULE OR BY DISCRETION? .................................................

86

3.

1.

The time inconsistency of discretionary policy and policy rules....................................................

87

3.

2.

Rules for Monetary Policy .............................................................................................................

92

3.

3.

Rules for Fiscal Policy...................................................................................................................

93

3.

4.

Uncertainty and Difficulties...........................................................................................................

94

4. NEW KEYNESIAN ECONOMICS .................................................................................................................

95

4.

1.

Small Menu Costs and Aggregate-Demand Externalities ..............................................................

95

4.

2.

The Staggering of Wages and Prices .............................................................................................

96

4.

3.

Recession as a Coordination Failure.............................................................................................

97

4.

4.

Hysteresis and the Challenge to the Natural-Rate Hypothesis ......................................................

99

4.

5.

Ignorance, Expectations, and Lucas Critique ..............................................................................

101

REFERENCES ............................................................................................................................................

102

GLOSSARY .................................................................................................................................................

103

CONTENTS .................................................................................................................................................

110