For Every Crisis Phiroze B Medhora The Crisis in Keynesian Economics by John Hicks; Oxford University Press, Delhi; pp 85; Rs 12.
THE three lectures were given some time in the middle of 1873. Their relevancy to current economic problems, as also the relevance of Keynes' "General Theory" to these problems, can hardly be doubted. Hicks argues that if the world did not face a crisis after the Second World War of the kind it had faced after the First World War, and if there was reasonable full employment and growth during the fifties and sixties, it was partly due to the application of Keynes' ideas and concepts in the post-Second-War situation. In the first lecture on saving, investment and the multiplier, Hicks refers to two major factors which affect the multiplier: first, the existence of stocks, and second, in an open economy, the existence of foreign exchange reserves. By a neat analysis. Hicks shows that the two are in effect interchangeable, and influence the value of the multiplier, lie deals mainly with the role of price expectations and their impact on stock-holding, bringing in the concepts of fixprice and fiexprice which determine the response of the market to a change in demand.
