Keynes versus Hicks y el tipo de interés natural

Un post espectacular sobre el debate Keynes versus Hicks y el intento de éste de encajarlo en el modelo clásico. Su intento dio lugar al modelo IS-LM, creado, y luego repudiado, por Hicks. Todo gira sobre la teoría del tipo de interés. Si uno es clásico, el tipo de interés lo determina el ahorro y la inversión. Hicks intenta sustituirlo por una teoría, de origen sueco, de demanda y oferta de fondos prestables (que es lo que maneja Krugman en su modelo IS-LM). Pero encajar a Keynes en el mundo de los clásicos es reducirlo a un modelo de equilibrio, y su teoría es un modelo de desequilibrio: es decir, un mondo en el que la reacción de los que tres no lleva a la situación anterior.

Para Keynes es fundamental su teoría monetaria, que expone por primera vez en su "Teoría General" (y que to sepa es el primero en formular: hasta entonces había aceptado la teoría del tipo de interés "natural"). En la TG no hay tipo de interés natural de equilibrio que garantice el pleno empleo. La gente primero decide que parte de su renta consume o ahorra: luego ha de decidir en qué coloca ese ahorro. Y no hay ninguna garantía de que lo coloque en instrumentos que financien la inversión productiva por un tipo de interés acorde con el pelo o empleo, como no hay garantía de que los salarios se ajusten a la baja los suficiente. Puede decidir atesorarlo en liquidez, lo que lleva a la recesión y, si el Banco a central no hace algo, quizás algo peor si los agentes están endeudados. No hay mecanismos de compensación de vuelta al equilibrio. Ni el tipo de interés ni los salarios ni los precios encuentran la senda que lleva de nuevo al pleno empleo, entre otras cosas porque no saben con certeza donde está ese punto de llegada.

Lo reproduzco íntegro.

Keynes’ Letters to John Hicks and IS-LM

In 1936 and 1937, John Hicks and John Maynard Keynes engaged in a correspondence regarding the General Theory and issues related to it.

In October 1936, John Hicks sent Keynes a letter in which he raised the issue of liquidity preference and interest rate theories and also sent Keynes a draft of his famous paper “Mr. Keynes and the ‘Classics’; A Suggested Interpretation” (Econometrica 5.2 [1937]: 147–159).

Keynes replied to Hicks on 31 March, 1937 in a letter that is sometimes taken to show that Keynes strongly approved of IS-LM (the letter can be found in Keynes 1973: 79–81).

Unfortunately, I have not had the time to chase up and read the full copy of Keynes’ letter, but some have actually argued that Keynes’ reaction to Hicks’ paper was only “lukewarm” (Kriesler and Nevile, “IS-LM and Macroeconomics after Keynes,” p. 4).

At any rate, Joan Robinson notes that Keynes did object to the model in his letter to Hicks:

“Whenever equilibrium theory is breached, economists rush like bees whose comb has been broken to patch up the damage. J. R. Hicks was one of the first, with his IS-LM, to try to reduce theGeneral Theory to a system of equilibrium. This had a wide success and has distorted teaching for many generations of students. Hicks used to be fond of quoting a letter from Keynes which, because of its friendly tone, seemed to approve of IS-LM, but it contained a clear objection to a system that leaves out expectations of the future from the inducement to invest.”(Robinson 1978: 13).

So Keynes did have reservations about the model’s ability to incorporate expectations, and also about loanable funds theory (Tily 2007: 207–208).

Moreover, Keynes and Hicks had further correspondence. In a later letter, Hicks affirmed that he was thinking of interest as determined by a type of loanable funds theory, or “by saving and investment” (Keynes 1973: 82).

Keynes replied in a short letter on 11 April, 1937 rejecting loanable funds:

Keynes to Hicks, 11 April, 1937
“Dear Hicks,

I do not really understand how you mean interest to be determined by saving and investment under II, near the bottom of your second page. However, I am trying to bring the whole thing to a head by a short article I shall write for the nextJournal commenting on Ohlin’s exposition of the Swedish theory of interest regarded as determined by the demand and supply for loans, which is being printed in the same issue. I am there accusing you of agreeing with the Swedes in this matter. If this is a calumny, and your theory is really quite different, forgive me.

Yours sincerely,
J.M.K.”
(Keynes 1973: 83).

The “short article” Keynes was writing was “Alternative Theories of the Rate of Interest” (The Economic Journal 47.186 [1937]: 241–252), in which Keynes numbered Hicks with Bertil Ohlin and Dennis Robertson as a supporter of loanable-funds, a theory which Keynes himself rejected (Keynes 1937: 241–243; Tily 2007: 209).

By implication, Keynes must have thought that Hicks held a theory of the interest rate that was wrong (Tily 2007: 209).

If IS-LM relies on a loanable funds model, and Keynes rejected loanable funds, then it is difficult to see how Keynes could have supported IS-LM, if he had been consistent.

And Hicks did continue to adhere to a modified form of loanable funds, and was even taken to task for it by others sympathetic to the General Theory like Hugh Townshend (1937) (King 2002: 22).

One can perhaps conclude that far too much has been read into the short and private letter Keynes wrote to Hicks, where Keynes may well have been being polite and encouraging to Hicks, and at the same time did not want to pick a fight with someone who was sympathetic to theGeneral Theory.