Heterodox Challenges in Economics – Theoretical Issues and the Crisis of the Eurozone

Blurb

The book underscores and critically assesses the analytical inconsistencies of European economic policy and the conservative nature of the current European governance. In this light, it examines the political obstacles to proposals to reform the European monetary union, as well as those originating in the neo-mercantilist German model. Given its scope and format, the book offers a valuable asset for researchers and members of the general public alike.

Book summary

This book discloses the economic foundations of European fiscal and monetary policies by introducing readers to an array of alternative approaches in economics. It presents various heterodox theories put forward by classical economists, Marx, Sraffa and Keynes, as a coherent challenge to neoclassical theory.

The book underscores and critically assesses the analytical inconsistencies of European economic policy and the conservative nature of the current European governance. In this light, it examines the political obstacles to proposals to reform the European monetary union, as well as those originating in the neo-mercantilist German model. Given its scope and format, the book offers a valuable asset for researchers and members of the general public alike.

Comment from our editors:

It has become one of the central bones of contention in economic policy and theory alike: austerity.

Ever since the financial crisis of 2008, many European governments (particularly those led by conservative parties) have not only implemented massive cuts in fiscal spending, in the German case even accompanied by legal rules to balance the state's books, but also forced others to do likewise (cue Greece). Only the extraordinary macroeconomic shock of the corona pandemic has broken up this unsavoury consensus by sheer necessity. Then again, economic policy is alway a matter of theory, too: Indeed, there is no economic policy without a theory guiding it.

To illuminate the theory behind austerity precisely as well as to challenge it with other schools of economic thought is the task taken up by this book. It vividly shows that always, there is an alternative to each and every economic policy which, by contrast to many a politician characterising it as "inevitable" or "dictated by the laws of the economy". Thus, this book combines theoretical debate with a practical example from recent history, making for intriguing read.