Harry G. Johnson

Macroeconomics is an outgrowth from the main stream of classical monetary theory following Keynes. Keynes changed the emphasis from determination of the level of money prices to determination of the level of output and employment. He also changed the key relationship from demand and supply of money as determining the price level to the relationship between consumption expenditure and income, in conjunction with private investment expenditure, as determining the level of output and therefore employment demanded. The income multiplier replaced the velocity of circulation as the key concept of monetary theory. The tendency of the past twenty-five years has been to reintegrate Keynesian and classical monetary theory into one general system of analysis. Moreover, as inflation has succeeded mass unemployment as a major policy problem, interest in classical monetary theory has revived, while Keynesians have increasingly' emphasized the monetary aspects of Keynesian theory. The proper contemporary distinction is not between two separate branches of economic theory, but between two areas of application or contexts of the theory of rational maximizing behavior. In the one (the microeconomic) context, it is assumed either that the overall workings of the economic system can be disregarded, or that the macroeconomic relationships are in full general equilibrium. In the other (the macroeconomic) context, it is assumed that the maximizing decisions of individual economic units (firms and households) will not necessarily add up to a macroeconomic equilibrium, but will produce a disequilibrium situation that will in the course of time produce changes in the individual decisions.

Macroeconomics and Monetary Theory

Jacob A. Frenkel

The studies in this book deal with the determination of foreign exchange rates and the characteristics of the foreign exchange market. Analysis is made of flexible exchange rates through an approach developed by the authors, called the ‘asset-market approach’. Theory is combined with practical application in a clear concise way that will be understood by readers with a basic understanding of economics.

Selected Studies

The Economics of Exchange Rates (Collected Works of Harry Johnson)

Supervised by Maurice Dobb, Harry Johnson was particularly impressed by the breadth and the ideas of Joseph Schumpeter, which greatly influenced his writings in later years. Johnson made many contributions to the development of Heckscher-Ohlin theory and also helped to found the monetary approach to the balance of payments. He wrote many surveys of monetary economics that helped to clarify the issues in question.

Collected Works of Harry G. Johnson

A sequel to Essays in Monetary Economics, this book develops the ideas on domestic and international monetary issues, with reference to specific events and crises of the 1960s and 70s. These essays are distinguished by the author’s expert grasp of the analytical techniques and contemporaneous policy problems of both domestic and international monetary economics.

Further Essays in Monetary Economics (Collected Works of Harry Johnson)

Harry G. Johnson was best known for his work on monetary theory and international economics, but he was also very active in the theory of distribution, trade strategy and development economics. These 4 books, originally published between 1967 and 1971 explore: The relationship between nationalism and economic development Trade policy to promote development The use of geometrical tools in international trade theory Issues surrounding multi-lateral free trade.

Harry G. Johnson on Trade Strategy & Economic Policy

This book collects together the basic documents of an approach to the theory and policy of the balance of payments developed in the 1970s. The approach marked a return to the historical traditions of international monetary theory after some thirty years of departure from them – a departure occasioned by the international collapse of the 1930s, the Keynesian Revolution and a long period of war and post-war reconstruction in which the international monetary system was fragmented by exchange controls, currency inconvertibility and controls over international trade and capital movements.

Harry G. Johnson

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