Brian Doherty on How the Hayek-Keynes Debate Shaped Modern Economics

February 16, 2012

British journalist Nicholas Wapshott’s new book, Keynes Hayek: The Clash That Defined Modern Economics is about a heated debate, eight decades past, between two of the most influential economists in modern history. That debate, which took place in the midst of the Great Depression, concerned the causes and cures of business cycle downturns. Today’s economic crisis, observes Senior Editor Brian Doherty, raises many of the same questions that fueled the intellectual duel between the British-born liberal lion John Maynard Keynes and F.A. Hayek, his free market Austrian friend and opponent. The confluence between subject matter and current events surely helped Wapshott sell his book to a publisher and likely will sell many copies to readers. But potential buyers should be aware that the book says nothing about how the economic dispute between Keynes and Hayek might apply to today’s economic situation. And as Doherty explains, this omission proves fatal.

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