Keynes Hayek: The Clash that Defined Modern Economics

Wapshott, Nicholas. Keynes Hayek: The Clash that Defined Modern Economics. New York: W. W. Norton, 2012.

From W. W. Norton:

As the stock market crash of 1929 plunged the world into turmoil, two men emerged with competing claims on how to restore balance to economies gone awry. John Maynard Keynes, the mercurial Cambridge economist, believed that government had a duty to spend when others would not. He met his opposite in a little-known Austrian economics professor, Freidrich Hayek, who considered attempts to intervene both pointless and potentially dangerous. The battle lines thus drawn, Keynesian economics would dominate for decades and coincide with an era of unprecedented prosperity, but conservative economists and political leaders would eventually embrace and execute Hayek’s contrary vision.

From their first face-to-face encounter to the heated arguments between their ardent disciples, Nicholas Wapshott here unearths the contemporary relevance of Keynes and Hayek, as present-day arguments over the virtues of the free market and government intervention rage with the same ferocity as they did in the 1930s.


Table of Contents:


ONE: The Glamorous Hero – How Keynes Became Hayek’s Idol, 1919-27

TWO: End of Empire – Hayek Experiences Hyperinflation Firsthand, 1919-24

THREE: The Battle Lines Are Drawn – Keynes Denies the “Natural” Order of Economics, 1919-27

FOUR: Stanley and Livingstone – Keynes and Hayek Meet for the First Time, 1928-30

FIVE: The Man Who Shout Liberty Valance – Hayek Arrives from Vienna, 1931

SIX: Pistols at Dawn – Hayek Harshly Reviews Keynes’s Treatise, 1931

SEVEN: Return Fire – Keynes and Hayek Lock Horns, 1931

EIGHT: The Italian Job – Keynes Asks Piero Sraffa to Continue the Debate, 1932

NINE: Toward The General Theory – The Cost-Free Cure for Unemployment, 1932-33

TEN: Hayek Blinds – The General Theory Invites a Response, 1932-36

ELEVEN: Keynes Takes America – Roosevelt and the Young New Deal Economists, 1936

TWELVE: Hopelessly Stuck in Chapter 6 – Hayek Writes His Own “General Theory,” 1936-41

THIRTEEN: The Road to Nowhere – Hayek Links Keynes’s Remedies to Tyranny, 1937-46

FOURTEEN: The Wilderness Years – Mont-Pèlerin and Hayek’s Move to Chicago, 1944-69

FIFTEEN: The Age of Keynes – Three Decades of Unrivalled American Prosperity, 1946-80

SIXTEEN: Hayek’s Counterrevolution – Friedman, Goldwater, Thatcher, and Reagan, 1963-88

SEVENTEEN: The Battle Resumed – Freshwater and Saltwater Economists, 1989-2008

EIGHTEEN: And the Winner Is… Avoiding the Great Recession, 2008 Onward





W. W. Norton