PRESTOPUNDIT

The IS/LM macroeconomic model should be history, but it isn't. Historians of economic thought chart the fate of the textbook Keynesian thinking of the 1950's which still dominates the imagination of the econobabblers -- the herd of economists, journalists, politicians, and Fed Board members who generate the idiot talk which passes for macroeconomic conversation in America. A highlight -- tracing the "liquidity trap" from Hicks to Krugman. The classic book on how the IS/LM model became "Keynesian economics" is David Laidler's, Fabricating the Keynesian Revolution, which was a the topic of perhaps the most successful Hayek-L email seminar ever.