Further Essays in Monetary Economics (Collected Works of Harry Johnson)

Chapter 1

Recent Developments in Monetary Theory—a Commentary*

I. INTRODUCTION

The Radcliffe Committee initiated its investigations into the working of the British monetary system at a time when the intellectual environment could be characterized as the high tide of Keynesian scepticism about the importance of monetary policy and the relevance of monetary theory. By the time its Report was published, however, that tide had begun markedly to ebb, a fact which accounts for the unexpectedly harsh reception the Report received even from what might have been expected to be intellectually sympathetic quarters. In the ensuing ten years, the tide has set markedly in the opposite direction, towards emphasis on the importance of monetary policy and concern ...