Peering over the edge of the short period? The Keynesian roots of stock-flow consistent macroeconomic models

Abstract

This work argues that institutionally rich stock-flow consistent models--i.e. models in which economic agents are identified with the main social categories/institutional sectors of actual capitalist economies, the short-period behaviour of these agents is thoroughly described, and the 'period by period' balance sheet dynamics implied by the latter is consistently modelled--are (i) perfectly compatible with Keynes' theoretical views, (ii) the ideal tool for rigorous post-Keynesian analyses of the medium run and, therefore, (iii) crucial to the consolidation of the broad post-Keynesian research programme. Copyright The Author 2009. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved., Oxford University Press.