Comment

Summary

Professor Brems gives a very articulate analysis of the Stockholm School and Keynes from the point of view “of the new reality of the steady-state equilibrium growth of the 1950s and 1960s” and he finds them, not unexpectedly, to be “obsolescent.” The only lasting contribution of the Stockholm School, from this perspective, is their “early insistence on the use of lags.” However, that was certainly not very original since Dennis Robertson excelled everybody in this respect with all types of lags in Banking Policy and the Price Level of 1926, which had a seminal influence on Keynes in his Treatise on Money of 1930.

From the perspective of the 1970s and 1980s, steady-state equilibrium growth has become obsolescent. Interest has focused on the role of information, for or against rational expectations, and disequilibrium dynamics. In this development, there has been a new interest in temporary equilibrium and sequential economics, both of which were central contributions of the Stockholm School.