New Keynesian Economics


New Keynesian Economics
The modern macroeconomic school of thought that evolved from classical Keynesian economics. This revised theory differs from classical Keynesian thinking in terms of how quickly prices and wages adjust. New Keynesian advocates maintain that prices and wages are "sticky", meaning that they adjust more slowly to short-term economic fluctuations.

This in turn explains such economic factors as involuntary unemployment and the impact of federal monetary policies.

New Keynesian economics as a philosophy took root in the 1980s in response to the criticisms of many of Keynes' original precepts as espoused by classical economists in the previous decade.

The new Keynesian theory attempts to address, among other things, the sluggish behavior of prices and its cause. The theory explains how market failures could be caused by inefficiencies and might justify government intervention. Whether this intervention should occur is a more complex question.


Investment dictionary. . 2012.

Look at other dictionaries:

  • New keynesian economics —   [njuː keɪnziən iːkə nɔmɪks, englisch], Neuer Keynesianismus …   Universal-Lexikon

  • New Keynesian economics — Not to be confused with Neo Keynesian economics. Economics …   Wikipedia

  • New Keynesian Economics — ⇡ Neuer Keynesianismus …   Lexikon der Economics

  • New institutional economics — (NIE) is an economic perspective that attempts to extend economics by focusing on the social and legal norms and rules that underlie economic activity. Contents 1 Overview 2 Institutional levels 3 Notes …   Wikipedia

  • Keynesian economics — Economics …   Wikipedia

  • Neo-Keynesian economics — Not to be confused with New Keynesian economics. Economics …   Wikipedia

  • Post-Keynesian economics — [There is semantic dispute as to whether there should be a hyphen between Post and Keynesian. The American journal of the same name does not use the hyphen despite its grammatical correctness, and the objection to its use dates back to Paul… …   Wikipedia

  • New classical macroeconomics — New classical macroeconomics, sometimes simply called new classical economics, is a school of thought in macroeconomics that builds its analysis entirely on a neoclassical framework. Specifically, it emphasizes the importance of rigorous… …   Wikipedia

  • New neoclassical synthesis — or new synthesis is the fusion of the major, modern macroeconomic schools of thought, new classical and new Keynesian, into a consensus on the best way to explain short run fluctuations in the economy.[1] This new synthesis is analogous to the… …   Wikipedia

  • New Economics — may refer to: New classical macroeconomics New Keynesian economics This disambiguation page lists articles associated with the same title. If an internal link led you here, you may wish to change the link …   Wikipedia


Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.