This document proposes that the best future for Post Keynesian economics is for Post Keynesian economists to teach the essential principles of true-Keynesian economics to students, professional economists, policymakers, the electorate, and the general public. It argues that true-Keynesian economics, based on Keynes' original work, differs significantly from the Keynesian neoclassical synthesis taught today. Teaching true-Keynesian economics under a new name, such as "true-Keynesian economics", would help distinguish it from the misrepresented version currently taught and better achieve the goals of reforming economics education and enhancing public understanding. The document outlines some key principles of true-Keynesian economics and argues

1. 1
D R A F T
"The Future of Post Keynesian Economics:
Teaching the Profession and the Public
the Essential Principles of True-Keynesian Economics"
© 2016
By
Professor Robert Ashford
Syracuse University
(315) 491-4888
rhashford@aol.com
I Introduction
II The Thesis
III What is Important?
IV The Essential Principles of Post Keynesian and True-Keynesian Economics
V Pluralism and Orthodoxy: The Big Tent vs, The Sound Foundation
VI What’s in A Name?
VII We Are All Keynesians Now.
VIII Conclusion
I. INTRODUCTION
One can consider the future of Post Keynesian Economics in (1) positive, predictive terms (i.e.,
what will its future be?), (2) normative terms (i.e., what should its future be?), (3) or both.
This paper will focus on the normative with the hope that it will influence the positive.
In their excellent book, The Oxford Handbook of Professional Economic Ethics, Professors
George F. Demarion and Deirdre N, McCloskey offer a rich array of perspectives on the normative
aspects of economic teaching and practice based the writings of an impressive number of admirable
contributors.
Significantly, the concluding Part VIII, “LOOKING AHEAD,” includes a “Code of Ethics for
Economists” proposed by Professor David Colander and adapted from the code of ethics for
Engineers, that sets forth many important ethical principles long in need of formal adoption by
professional organizations of economists.
Most of those principles in Dr. Colander’s proposed code concern matters beyond the scope of this
paper; and happily many self-described post Keynesian economists have (in my view) consistently
abided by them in an exemplary manner albeit without formal adoption.
Nevertheless, to enhance the development of the thesis of this paper (set forth below) without any
implication that they are honored in the breach, several of the Code’s principles are noteworthy:

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“III. Professional Obligations
. . .
2. Economists shall at all times strive to serve the public interest
. . .
c. Economists are encouraged to extend public knowledge.
. . .
3, Economists shall avoid all conduct or practice that deceives the public.
a. Economists shall avoid all the use of statements containing a material
misrepresentation of fact or omitting a material fact.”1
To these, there should be added one principle not explicitly found in Dr. Colander’s proposed
ethical code.
This addition is offered with the recognition that the ethical responsibility to comply with it almost
“goes without saying”: namely the professional obligation to address issues according to their
importance.
II. THE THESIS
The best normative future for Post Keynesian economics is for Post Keynesian economists
whose economic analysis is grounded in the essential principles of Post Keynesian economics (set
forth below and open for correction and amendment) to teach and advance those principles as such
to the following persons who are insufficiently aware of them and the important differences in
these principles when compared to the principles underlying Paul Samuelson’s Keynesian
neoclassical synthesis economics: (1) students of economics (whether or not economics majors),
(2) professional economists, (3) public and private employed professionals having responsibility
for economic issues, and (4) the electorate, and (5) the general public. Further, they should teach
these principles under the name “true-Keynesian Economics.”
III. WHAT IS IMPORTANT?
In light of the ethical principles set forth in the Introduction, in particular the ethical
responsibility to address issues according to their importance, here are some important
propositions:
1. In the time it took to read to this point in this paper, many thousands of people have
prematurely died, many thousands more (although still alive) are too far gone to escape
death, and many people have suffered by reason of national economies (and in a global
economy) not operating at the full employment of labor and capital that (that if operating
at fuller employment) could save or could have spared them from such fate.
2. Reducing this death rate and suffering and sustainably raising the standards of living of the
vast majority of people require sustainable fuller employment.
1
Id, pages 744-745.

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3. Sustainable fuller employment requires fuller employment of greener technologies that too
many people cannot presently afford.
4. Although general equilibrium (Walrasian) economics rests on an analysis that assumes the
existence of full employment, mainstream political discourse (which generally defines the
realm of achievable structural and infrastructural reforms to achieve fuller employment)
(1) proceeds under the assumption that national economies are not operating at full
employment and
(2) seeks to achieve fuller employment under assumptions that recognize only two broad
categorical policies to achieve fuller employment: austerity and stimulus.
5. To ameliorate barriers to fuller employment
(1) Walrasian economics provides theoretical support for the proposition that Government
is generally a problem (except perhaps to address externalities, public goods, anti-
competitive behavior, etc.),
(2) Samuelson Keynesian neoclassical synthesis economics provides theoretical support
for the proposition that Government may be a problem and/or may be a solution in the short
run, but is not a solution and may be a problem in the long run;
(3) Keynesian economics according to Keynes (i.e., “True-Keynesian economics”)
provides theoretical support for the proposition that Government is a necessary part of the
solution to fuller employment in both the short and the long run vis-à-vis a laissez faire
market oriented economy.
6. (1) Virtually all members of the public with sufficient economic understanding to
recognize that (a) neoclassical (or “free-market”) economics provides a major theoretical
component in support of pro-austerity politics and solutions (b) so-called Keynesian
economic (in reality Samuelson’s synthesis) provides a major theoretical component in
support of pro-stimulus politics and solutions, and
7. (2) an alarming number students of economics, teachers of economics, and
professional economists, but thankfully not most Post Keynesian economists)
are analyzing economic issues under the serious false impression that Samuelson’s
Keynesian neoclassical synthesis economics is consistent with true Keynesian economics
as advanced by Keynes (i.e., true-Keynesian economics).
7. The more widely shared the perception that government is a problem
(1) the greater the cost of enlisting government assistance in achieving fuller employment,
and
(2) the greater the disadvantage of the vast majority in achieving government assistance to
enhance their economic opportunity.
In light of the foregoing, for clarity of exposition, I repeat the thesis: The best normative future
for Post Keynesian economics is for Post Keynesian economists whose economic analysis is
grounded in the essential principles of Post Keynesian economics (set forth below and open for
correction and amendment) should teach and advance those principles as such to the following
persons who are insufficiently aware of them and the important differences in these principle when
compared to the principles underlying Paul Samuelson’s Keynesian neoclassical synthesis
economics: (1) students of economics (whether or not economics majors), (2) professional

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economists, (3) public and private employed professionals having responsibility for economic
issues, and (4) the electorate, and the general public. Further, they should teach these principles
under that name “true-Keynesian Economics.”
IV. THE ESSENTIAL PRINCIPLES OF POST KEYNESIAN AND TRUE-
KEYNESIAN ECONOMICS
To achieve this best normative future, Post Keynesian economists willing to pursue the strategy
advanced in this paper will have to reach general agreement on the essential principles of Post
Keynesian and true-Keynesian economics. The exposition set forth below is based largely on the
writings of Dr. Paul Davidson.
Additional principles may be added, and corrections of the exposition are most welcome. To build
a viable, new or newly named school of thought worthy of pedagogical respect and capable of
enlisting support and advocacy from a critical number of adherents, there is room for flexibility in
this regard.
However, for reasons described in Part V below, there is good reason to avoid such inclusion of
principles that would stray into an organizational strategy that is often characterized as” the big
tent approach.”
To advance the strategy proposed in this paper, the essential principles of Post Keynesian
economics should be (1) few in number, (2) identical to fundamental principles advanced by
Keynes in his General Theory, but (3) sufficient to teach the fundamentals principles that
distinguish True-Keynesian economics from Samuelson’s synthesis.
In his General Theory, Keynes specifically rejected three basic axioms on which neoclassical
general equilibrium (i.e., Walrasian) theory and instead established an alternative foundation based
on the “essential properties of liquid assets.” The three rejected neoclassical axioms are:
(1) The gross substitution axiom: the axiom that all goods including liquid assets (i.e.,
money and money equalivants) are substitutable for all other goods (including
producible real capital assets (i.e., that everything is substitutable for everything else).
Keynes maintained that by reason of a preference for liquidity, producible goods were
not good substitute for liquid assets for the purpose of saving.
(2) The neutrality of money axiom: the axiom that the quantity of money was neutral as to
the magnitude of real production and affected only prices in the long run. Keynes
maintained that money was never neutral as to production in either the short or the long
run.2
(3) The axiom of an ergodic economic world: the axiom that samples drawn from the past
will allow for reliable probabilistic predictions of the future.
Each of these axioms must be taken as true for Walrasian general equilibrium to be true. Thus, by
logical implication, and by his own words,3
Keynesian economics according to Keynes rests on a
firm rejection of the most rigorous form of orthodox neoclassical theory in both the short and the
long run.
2
Keynes, “A Monetary Theory of Production in D. Moggridge (ed.) The Collected Writings of John
Maynard Keynes, Vol. 13 London, MacMillan (1935), pp. 408-409, reprinted 1973, pp 409-411.
3
See John Maynard Keynes, The General Theory of Employment, Interest and Money 3 (Palgrave Macmillan 1936)
(describing the teaching of classical theory as potentially “misleading and disastrous”).

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Having rejected the money neutrality axiom in both the short run and long run, and having
declared the special importance of money to the magnitude of production, in both the short and
long run, Keynes recognized the need to specify in Chapter 17 of his General Theory “the Essential
Properties of Interest and Money”:
(1) The elasticity of production of all liquid assets is zero or negligible, 4
and
(2) The elasticity of substitution between all liquid assets and other (reproducible) goods
is zero or negligible.5
Regarding the zero or negligible elasticity of production of liquid assets, readers should
understand that in the case of most goods, the level of production is positively related to Market
demand: As the market demand at which a good can be sold for rises, producers will employ more
labor and capital to produce more of that good. But not so in the case of money. Money cannot
be produced by labor or grown on trees. Its elasticity of substitution is zero 6
Regarding the elasticity of substitution property, Keynes maintained that the preference for
liquidity to satisfy both short- and long-run anticipated and unanticipated contractual obligations
in an uncertain, non-ergodic economic world would inevitably result in a withholding (in the form
of financial savings) of income earned in production from being spent both on consumer goods
and on investment in more production.7
The liquidity preference would lead to non-employment inducing demand for liquid financial
saving that would (without government action) persist indefinitely (i.e. not only in the short-run,
but also in the long run) in an economy operating at less than full employment even with perfectly
flexible and rapidly adjusting prices and wages that are assumed (by general equilibrium
neoclassical economic orthodoxy) to exist to optimize full-employment production and clear
markets in theory.
V. PLURALISM AND ORTHODOXY:
THE BIG TENT VS. THE SOUND FOUNDATION
Post Keynesian economists are by no means alone in their opposition to the pernicious, undue
influence of neoclassical economic orthodoxy on contemporary mainstream thought and
discourse.
This opposition is evidenced by the emergence of (1) behavioral, binary, ecological, feminist,
ecological, and other schools of economics, (2) the longstanding existence and continuing
development of a host of older heterodox schools (including evolutionary, historical, institutional,
social and Marxian economics, (3) interdisciplinary approaches such as socio-economics, and the
emergence of the International Confederation of Associations for Pluralism in (ICAPE).
4
Id., at pp, 230-231.
5
Id.
6
Id at pp. 230.
7
In a world of uncertainty, the use of forward money contracts is the way decision makers try to have some
certainty control over future cash inflows and outflows. And with money contracts being used to organize and
enforce virtually all market transactions, the possession of liquidity provides the possessor with a security blanket to
assure one is not likely to fall into bankruptcy in the future.

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In promoting an understanding of fallacies underlying pernicious orthodoxies, such big-tent
approaches certainly have pedagogical and ethical value.8
Among other things they offer aroad,
inclusive intellectual foundation for organizing, coordinating, and implementing programs,
conferences and activities that help to teach and demonstrate the fallacies and inadequacies that
result from the abuse of neoclassical economics.
But criticism of the dominant, mainstream, general equilibrium economic orthodoxy on
grounds of its lack of pluralism does not with clarity and precision expose the fundamentally
misleading fallacy in the ways in which economics and economic policy are presently taught and
practiced in academia under the deceptive rubric of the Samuelson’s Keynesian neoclassical
synthesis).
Nor does it with clarity and precision expose the fundamentally misleading fallacy in the ways
that economic policy is discussed and debated in mainstream political discourse and implemented
by government: namely that what passes for “Keynesian economics” (the only mainstream
theoretical pro-stimulus alternative to austerity) is false Keynesian economics advanced under the
deceptive rubric of the Samuelson’s Keynesian neoclassical synthesis.
Nor does it with clarity and precision reveal that there is a true Keynesian economics that in its
essential policy import can and should be successfully taught, not only to students of economics
and professional economists, but also to the electorate (if democracy regarding economic matters
is to be functionally revitalized) and to the general public.
In short, falsely passing Samuelson’s Keynesian neoclassical synthesis as Keynesian economics
(which is how it is taught in departments of economics, understood in mainstream political
discourse, and for decades implemented by government), is fundamentally mispleading.
For all of its virtues in providing an inclusive forum for all of the excellent insights and
perspectives advanced by the rich array of heterodox and alternative economic organizations, a
focus on the need pluralism is not well-suited to expose and correct the fallacy of passing off false
Keynesian economics for true Keynesian economics.
Indeed, emphasizing the need for pluralism draws attention away from a fundamental fallacy in
need of correction.
The needed exposure and correction requires a rigorous argument supported by convincing
evidence. Such arguments are not made and such evidence is not offered under a big tent, but
rather on a solid foundation.
The essential principles of Post Keynesian economics provide the necessary solid foundation.
Of all the economic schools of thought and organizations that richly contribute to the enhancement
of economic understanding, only the Post Keynesian school is specially dedicated to exposing and
correcting this fundamentally important misrepresentation.
As discussed more fully below, its success in exposing this misrepresentation and in teaching true
Keynesian economics and its future as a school of economics both normatively and positively
would greatly enhanced if its name were changed to “true-Keynesian economics.”
VI. WHAT’S IN A NAME?
8
Significantly, DeMartino and McCloskey wisely conclude The Oxford Handbook of Professional Economic Ethics
with an insightful Chapter 37, by Sheila C. Dow entitled “Codes of Ethics for Economists, Pluralism, and the Nature
of Economic Knowledge.”

7. 7
From childhood, people are cautioned, “Don’t judge a book by its cover”; but everybody does.
The current jargon of the “elevator talk” (needed to convey a crucially important idea to a busy
person with limited time) and “the takeaway” communicates an unfortunate contemporary
impatience and arrogant assumption that important information necessary for dispelling widely-
shared pre-conceptions and fundamentally new insights can be communicated in tweet; but that is
the reality with which reformers are confronted.
In this context, the name “Post Keynesian economics” does not serve to best advance the goals of
its founders.
If two objectives of most Post Keynesian economists are to positively reform the economics
discipline and enhance the public understanding of economics, then the name “Post Keynesian
economics was not the best choice (and prospectively is a poor choice) as a brand name to serve
those purposes.
In historical context, the choice of the name Post Keynesian Eonomics is easily understandable:
If one believes that the insights of Keynes fundamentally changed the economics discipline (as it
did), then “pre-Keynesian” economics would eventually become a historical relic of a by-gone
conceptual era, and like post-industrial and post-modern, “Post Keynesian” would come to be
viewed as establishing the new foundation to replace the antecedent classical (and neoclassical)
foundation as Keynes explicitly intended to do.
The problem with this optimistic aspiration is that “post” has the broader, and more
ambiguous, meaning of “anything after.”
It is not limited to the essential principles identified above (or any principles for that matter).
Rather it can be understood to include a plethora of later emerging economic schools that do not
succinctly advance (or even depend on) Keynes’s essential principles as the necessary foundation
for achieving fuller employment.
Indeed, even Robert Lucas and other so-called new classical economists (who entirely reject
Keynes’s essential principles both in the short and the long run) could also be called “Post
Keynesian” in this broader sense of the term.
Thus, the problem with the term “Post Keynesian” is that it fails to communicate concisely
the important challenge to the legitimacy of Samuelson’s false orthodoxy; whereas in two words,
“true-Keynesian” inescapably communicates that challenge and ha the potential to inspire interest
to discover the arguments and evidence in support of that challenge.
Admittedly, a decision to change the name of a school of thought after so many years of excellent
scholarship produced under its banner should not be undertaken without careful consideration; but
in this instance the name change, provocative as it may be perceived, may offer the advantage of
calling attention to, and raising curiosity, regarding the essential principles that support the name
change and therefore may add veritable strength to the adage, better later than never.
VII. WE ARE ALL KEYNESIANS NOW.
Some economists may offer objections to the charge that Samuelson’s Keynesian neoclassical
synthesis is a misrepresentation by asserting that (1) the substance of the synthesis and resultant

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departure from Keynes’s understanding of Keynesian economics was necessary to ground
Keynes’s important insights on the solid foundation of Walrasian economics deemed by
Samuelson and others as necessary to preserve the status of economics as a science, and (2) the
need for the synthesis was and is fully explained. Professor Davidson has ably responded to these
objections on the economic merits.9
In addition to Professor Davidson critique on the merits, the following should be noted.
Samuelson may (as many believe) or may not (as I join Professor Davidson and many others in
believing) be correct on the merits, but neither he nor most of the others who advanced texts on
the subject made clear the differences between the synthesis and Keynesian economics according
to Keynes.
In terms of the ethical responsibility “to avoid all conduct and practice that deceives the
public,” the question is not whether a change in Keynes’s analysis was needed to make it “correct”
economically or to maintain the status of economics as a science.
Rather, the ethical question is whether it was and continues to be a misrepresentation by
Samuelson and all who followed in his analysis to continue to call a dismembered portion of
Keynes’s integral analysis “Keynesian” especially when joined with principles Keynes explicitly
rejected.
There would be no objection if Samuelson has appropriately cited Keynes for his insights,
incorporated them into what Samuelson regarded as his economically correct and scientific
approach and then labeled the synthesis “Samuelsonian economics.”
Whatever the motive (whether ignorance, intended misrepresentation, or something else), what
Samuelson and his followers called Keynesian economics and then “Keynesian revolution” was
not Keynesian because it is not Keynesian economics according to Keynes.
In short, falsely passing Samuelson’s Keynesian neoclassical synthesis as Keynesian economics
(which is how it is taught in departments of economics, understood in mainstream political
discourse, and for decades implemented by government), is fundamentally mispleading.
Whatever the motive or reason, there can be little doubt that Samuelson and his followers deceived
and continue to deceive the public. ‘
In this regard, it is instructive to consider Milton Friedman’s contribution to the public
misperception that Samuelson’s synthesis could fairly be called “Keynesian”.
Although identified by himself and virtually everyone as a conservative economist and statesman
on the right of the political spectrum, it was he who declared, “we are all Keynesians now” 10
– a
statement also frequently attributed to President Richard Nixon soon after taking the U.S.A. off
9
Paul Davidson, “What Was the Primary Factor Encouraging Mainstream Economists to Marginalize post
Keynesian Theory?, Journal of Post Keynesuian Economics, 37:3, 369=383 (2015) and Post Keynesian Theory and
Practice: A Realistic Analysis of the Market-Oriented Capitalist Economy, Edward Elgar (Cheltenham, UK -
Northampton, MA, USA 2016)
10
In the February 4, 1966, edition of Time Magazine, Friedman wrote a letter clarifying his original statement as
follows: “In one sense, we are all Keynesians now; in another, nobody is any longer a Keynesian.” See generally,
Bruce Bartlett, Keynes and Keynesianism, THE NEW YORK TIMES (May 14, 2013), available at
http://economix.blogs.nytimes.com/2013/05/14/keynes-and-keynesianism/. This clarification is consistent with his
understanding of the fact that Paul Samuelson’s Neoclassical Synthesis of Keynesian Economics is inconsistent with
the analysis that Keynes actually proposed, as explained above.

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the gold standard.11
Unmistakable proof of Friedman’s adherence to at least a portion of Keynesian
principles is clearly evidenced in Chapter XI of his widely read Capitalism and Freedom in which
he proposed his widely noted negative income tax.12
Why would he do so? Even a cursory reading of that book and most of his other political-
economic writings reveal a world view that regarded the concentration and exercise of
governmental power beyond that minimally necessary to protect personal (including economic)
freedom as a threat and the concentration of economic power in private hands asan antidote to that
threat.13
Thus, he advanced the negative income tax in recognition of the Keynesian view that markets
could and generally did reach equilibria at less than full productive capacity by reason of their
failure to distribute sufficient aggregate demand to employ the labor and capital available to
achieve it.
In light of that recognition, the negative income tax offered the most minimally intrusive
governmental way of directly addressing the need to provide the aggregate consumer demand to
move the economy toward fuller employment.
This approach maximized individual choice, and minimized government choice, in how the
demand was directed.
Keynes himself preferred the more precise and particularistic recourse to fiscal policy rather
than monetary policy.
Like other Neo-Keynesians, Friedman preferred monetary policy precisely because it seemingly
offered economy-wide stimulant effects without the greater and more specific governmental
decision-making inherent in fiscal policy.
And consistent with his preference for minimizing government action, Friedman preferred to
avoid the fine tuning of monetary policy based on response to past events, and instead favored
simply a steady increase in the money supply which he believed would lead to steady growth – a
policy that gives rise to the Monetarist School which he is credited with founding and a grounded
in the neutral money axiom (which Keynes categorically rejected in both the short and the long
run) if economic growth of X% was assumed as a normal trend.
Samuelson was joined in his deceptive neo-Keynesian approach by many other economics
luminaries including William Baomol, James Dusenberry, Robert Eisner, Walter Heller, John
Hicks, Abba Lerner, Franko Modligiani, Robert Solow, and James Tobin’
These and many others combined to establish the neo-Keynesian orthodoxy. So successful was
this synthesis, that in 1955, Samuelson claimed that it had the support of “90 percent of American
Economists … accepted in its broad outlines by all but about 5 per cent of extreme left wing and
right wing writers.”14
11
See generally, Bo Sandelin, Hans-Michael Trautwein & Richard Wundrak, A Short History of Economic Thought
90 (Routledge 2014).
12
Milton Friedman, Capitalism and Freedom 191-194 (University of Chicago Press 1962).
13
Robert Ashford, “Milton Friedman’s Capitalism and Freedom: A Binary Economic Critique”
Vol. XLIV Journal of Economic Issues 533-542 (2010)
14
Samuelson, Principles of Economics 1955, p 212.

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As is well known among economists, this approach became the economic orthodoxy that prevailed
with little dissent until the late 1960s and early 1970s until confronted by events primarily related
to inflation, unemployment, and stagnation that it seemingly could not explain or remedy.
Nevertheless, during its reign, none the illustrious array of prominent and well-paid economists
associated with what was widely and falsely labeled “the Keynesian Revolution” felt morally
obliged to explain in publications, to their students, or to the public their analytical differences
with Keynes, whose name, analysis, and motivations laid the foundation for their prominence and
financial success.
Nor is there widespread understanding among mainstream politicians, business leaders, and the
general public, and perhaps professional economists that the counterfeit Keynesian theory and
policies discredited s during the late 1960’s and 1970’s were not the theories and policies
advocated by Keynes.
VIII. CONCLUSION
Needless to say, the misleading success of an erstwhile, long-reigning but now somewhat
discredited counterfeit orthodoxy responsible for the education of generations of students of
economics and professional economists, but resting on assumptions foundationally inconsistent
with those advanced by its namesake, is problematic for non-economists who must rely on
economic analysis in pursuing their professional obligations and personal interests.
To the extent that a well-functioning democracy is dependent a well-informed electorate and
economic literacy is essential for people to vote in their economic interests, the ethical
responsibility of economists to remedy the damage of the misrepresentation, now some seventy
years in perpetuation, should not continue to go unfulfilled.
Some might take solace by the belief that only members of the public, and not the students of
economics who became the later generations of professional economists, were misled. However,
the history of economics teaching and practice suggests that too many professional economists
were misled as well
I would wager that if a large random sample of professional economists (who arìe not post
Keynesians) were put in a room with a blank writing tablet and two hours two write and asked to
explain the difference between Samuelson’s synthesis and Keynes economics according to
Keynes, an alarming percentage would not be able to compose a passing answer.
Thus, it may fall to the post Keynesians (or perhaps to the sub-set of self-styled post
Keynesians who accept that name on the basis of the essential principles, rather than the more
nebulous big tent) to take the lead in the effort to correct the misrepresentation to the profession
and the public.
In so doing I believe that this principled, ambitious, and heroic task can best succeed under the
name, “true-Keynesian economics.”