Thursday, December 25, 2014

Keynes vs. Hayek on Christmas Day

From Keynes Hayek: The Clash that Defined Modern Economics:
Even the arrival of Christmas did not slow the to-and-fro. On Christmas morning Hayek wrote to Keynes, "I am sorry I have misunderstood your question." The "total effective circulation" was simply the total of all money payments effected (in cash, bank deposits, or whatever form) during any arbitrary period of time. That afternoon--in those days the Royal Mail delivered twice daily, even on Christmas Day--Keynes replied, "That is what I thought you meant," though he quickly added, "and that is just my difficulty." Hayek may have felt that despite Keynes's reservation about terms, he was moving closer to his rival the better to refute his ideas; after three letters signed "J. M. Keynes," Keynes this time signed off his Christmas letter with the marginally less  formal "J.M.K."

1 comment:

  1. The sincere Keynesian engagement of Austrian ideas continues to this day.