Expectations, Employment and Prices [Hardcover]

Expectations, Employment and Pricesbrings Keynesian economics into the 21st century by providing a new paradigm that explains how high unemployment could potentially persist forever without a little help from the government. The book fills in logical gaps that were missing from Keynes'General Theory of Employment Interest and Moneyby reconciling some of its key ideas with modern economic theory. Central bankers throughout the world are talking now about developing a second instrument of monetary policy in addition to controlling the interest rate. Roger Farmer directly addresses this issue and offers new creative monetary policy proposals and suggestions for the design of new financial institutions for the 21st century.

This is an ambitious book. We need to develop new approaches to business cycles and unemployment. Roger Farmer's attempt is refreshing, insightful and bold. --Daron Acemoglu, Charles P. Kindleberger Professor of Applied Economics, MIT and Co-Editor ofEconometrica

This book is modestly represented by its author as an extension to Keynesian economics. But I am more inclined to represent it as a new tradition, 'Farmerian economics.' While both are intended to provide justification for active countercyclical policy in the face of market failure, the microfoundations for Farmerian economics are much stronger than those of John Maynard Keynes. Farmerian economics is as distinct from Keynesian and New Keynesian economics as Lucasian economics is from Classical and New Classical Economics. --William A. Barnett, Oswald Distinguished Professor of Macroeconomics, University of Kansas, and Editor,Macroeconomic Dynamics

In this important book, Roger Farmer challenges the commonly accepted structure of modern DSGE models. Since these models are still, at their core, neoclassical constructs they miss much of the intuition of Keynes' original contribution. Farmer builds microfounded lc+