HES: Re: DISC--Textbooks and the myth of Keynes and the classics

[Barkley Rosser]

Pat,
     Interesting paper.  Given the instabilities
it documents in relationships in the German economy,
I would not put to much weight on the VAR results
it presents, which seem to suggest that neither
monetary nor fiscal policy had much impact in the
1933-36 period, although the author apparently
accepts that policy did prevent Germany from 
experiencing a downturn in 1937.  The paper seems
to document that the exact nature of fiscal policy
in particular varied substantially across those
years, stimulative in 1933-34 and after 1936, but
so much in 1935-36.  Also, it is clear that I was
wrong about military spending, and that it was a
higher percentage of what was going on during the
1933-36 period.

As I did not bring up the Keynes quote from the
German preface, I shall not comment on it.  The
notes that the issue of fiscal policy in Germany
in that period is very much up for debate, but I
would not consider this paper definitive in its
conclusions, which do not completely discount a
role for fiscal policy in any case, even if it
says it is much less than many have thought.

Barkley Rosser