Axel Leijonhufvud

Infobox_Scientist
name = Axel Leijonhufvud


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birth_date = 1933
birth_place = Stockholm, Sweden
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residence = USA
nationality = Swedish
field = Economist
work_institution = UCLA Brookings Institution

alma_mater = Lund University
University of Pittsburgh
Northwestern University

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known_for = Alternatives to Keyensian macroeconomics
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Axel Leijonhufvud (1933 Stockholm, Sweden) is a Swedish economist, currently professor emeritus at UCLA. He received his Ph.D. from Northwestern University in 1967. His most famous scholarly article is "On Keynesian Economics and the Economics of Keynes" which appeared in the AER in 1968. In this article, Leijonhufvud argued that John Hicks' IS/LM formulation of Keynes "General Theory" which emphasizes Walrasian equilibrium and rigid wages as an explanation for unemployment is in fact contrary to Keynes' writings. Rather, Leijonhufvud's reading of Keynes emphasizes disequilibrium phenomena, which can't be addressed in the IS/LM framework, as central to Keynes explanation of unemployment and economic depression. Leijonhufvud used this observation as a point of departure to advocate a "cybernetic" approach to macroeconomics where the algorithm by which prices and quantities adjust is explicitly specified allowing the dynamic economy to be studied without imposing the standard Walrasian equilibrium concept. In particular, Leijonhufvud advocated formally modelling the process by which information moves through the economy. [Snowdon 2002] While the "cybernetic" approach may have failed to gain traction in mainstream economics, [Howitt 2002] it presaged the rational expectations revolution that would ultimately supplant the IS/LM model as the dominant paradigm in academic macroeconomics.

Notes

References

*Howitt, Peter [http://www.econ.brown.edu/fac/Peter_Howitt/publication/Dalloz.pdf A Dictionary Article on Axel Leijonhufvud’s "On Keynesian Economics and the Economics of Keynes: A Study in Monetary Theory"] . Brown University. January 29, 2002. Accessed April 28, 2008.

*Snowdon, Brian [http://www-ceel.economia.unitn.it/staff/leijonhufvud/interview.pdf "Outside the Mainstream: An Interview with Axel Leijonhufvud"] . Northumbria University. May 17, 2002. Accessed April 28, 2008.

Link

[http://www.econ.ucla.edu/people/Faculty/Leijonhufvud.html Axel Leijonhufvud's Homepage]