The shortcomings of Keynesianism: the confusion between the rate of interest and profit

Abstract

This paper is an endeavour to shed some light to the gaps and contradictions in the Theory that Keynes put forward. The Theory, far from being revolutionary, reiterated the neo-classical views on a number of issues, portrayed a distinct lack of an analysis of phenomena of profound significance such as Credit and put overwhelming emphasis on the rate of interest. Based on
such a singularity, Keynes, using one Theory (that of the rate of interest), attempted to explain, both the rate of interest as well as profit, the driving force in capitalism. As a consequence, a great deal between the two was missing.

JEL Classification: E21.22, D50, B20, 25