A New Principles of Economics

CHAPTER THIRTEENEconomic fluctuations and aggregate economic evolution

DOI: 10.4324/9781003094869-18

1. Introduction

Economic fluctuations are a universal phenomenon in human economic history and stand at the core of extensive macroeconomic analysis and debates.¹ Two major schools can be distinguished that have been facing each other for decades, albeit under different labels and guises: the neoclassical, later, new classical school, and the different Keynesian schools. Besides their differences, the two strands exhibit important commonalities. First, they tend to deal with economic fluctuations in a relatively compartmentalised fashion, separating theories of business cycles from theories of economic growth. Second, they primarily associate ...