Conditions for a post-Keynesian revolution: An institutionalist analysis of macroeconomics and economic development
The global financial crisis, the COVID-19 pandemic, the Ukraine war, and the ecological crisis put conventional economic policies to the test after the emergence of neoliberalism. As the economic mainstream was not ready for solutions such as economic planning and coordination, a group of post-Keynesian economists (neo-chartalists) who define money as a creature of the state gained prominence. They were successful in creating a brand "Modern Money Theory," a clear message "Taxes do not fund government spending," a bold proposal "The state can guarantee a job for everyone willing and able," and a slogan "Green New Deal." While they do not deny the role of the market, MMT calls for economic planning. However, they do not have a theoretical framework that accounts for the necessary institutional change and the design of institutions capable of dealing with the conflicts and contradictions of this challenge. We present two essays to deal with this problem, and both start from the privileged point of view of Thorstein Veblen's Radical Institutionalism as an important influence of several neo-cartelists; and Karl Polanyi, one of the advocates of cartalism and credit money. The first essay aims to outline a macroeconomics consistent with Veblen and Polanyi and collate it with MMT. The second essay extends post-Keynesian institutionalism to Kaldorian and Polanyian approaches to economic development. The result is the outline of a Political Economy approach with a radical institutionalist bias that can, if accepted, extend MMT's framework of analysis and public policy prescription to a wider diversity of institutional contexts and center-periphery relationships than MMT had originally analyzed.