Macroeconomics and the Crisis: A Personal Appraisal

CEPR Policy Insight No 41

Axel Leijonhufvud

In a new CEPR Policy Insight, Axel Leijonhufvud argues that theories that assume that the economy is a stable general equilibrium system, albeit beset with some frictions and imperfections, do not hold true in general and that we need a new paradigm of economic thought.