Concluding remarks

Abstract

Since 2008 the most advanced capitalist countries have suffered financial instability and mass unemployment, often likened to the catastrophic Great Depression of the 1930s. Which economic theory can better explain the root causes of the crisis, the practical moves that can be designed and implemented by governments to contain the crisis and better guidance to prevent such crises in the future? The theory advanced by Kalecki and Keynes, emphasizing effective demand in the economy, or the mainstream theory that rests on supply-side factors in output and employment, fiscal austerity, and a quantity theory of money approach to prices? The latter theory has brought the misery of unemployment and instability. Full employment depends upon a return to the theory of Kalecki and Keynes.