閤 Keynes's General Theory: Interpreting the Interpretations OR。 Bill gerrard The Economic Journal, Vol. 101, No. 405(Mar, 1991), pp 276-287 Stable url: http://inks.istororg/sici?sic0013-0133%28199103%029101%03a405%03c276%3akgtiti3e2.0.co%3b2-q The Economic Journal is currently published by Royal Economic Society Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/about/terms.htmlJstOr'sTermsandConditionsofUseprovidesinpartthatunlessyouhaveobtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the jsTOR archive only for your personal, non-commercial use Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at Each copy of any part of a JSTOR transmission must contain the same copyright notice that ap on the screen or printed page of such transmission STOR is an independent not-for-profit organization dedicated to and preserving a digital archive of scholarly journals. For more information regarding JSTOR, please contact support @jstor. org http://www.jstor.org Thu mar1521:39:092007
Keynes's General Theory: Interpreting the Interpretations Bill Gerrard The Economic Journal, Vol. 101, No. 405. (Mar., 1991), pp. 276-287. Stable URL: http://links.jstor.org/sici?sici=0013-0133%28199103%29101%3A405%3C276%3AKGTITI%3E2.0.CO%3B2-Q The Economic Journal is currently published by Royal Economic Society. Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/about/terms.html. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/journals/res.html. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is an independent not-for-profit organization dedicated to and preserving a digital archive of scholarly journals. For more information regarding JSTOR, please contact support@jstor.org. http://www.jstor.org Thu Mar 15 21:39:09 2007
he Economic Journal, IoI(March 1991), 276-287 Printed in great Britain KEYNESS GENERAL THEORY: INTERPRETING THE Ⅰ NTERPRETATIONS* Bill gerrard Keynes's General Theory has given rise to a variety of Keynesian research programmes. The development of these different Keynesian research pro- grammes is well-documented(see, for example, Coddington, 1976, Gerrard, 988; Hamouda and Harcourt, 1988, for surveys of Keynesian and post Keynesian economics). However less attention has been paid to explaining a striking feature of this Keynesian diversity, namely, the stress placed on discovering the real meaning of Keynes's General The legitimacy of any particular Keynesian research programme has been judged with regard to the authenticity of its implied interpretation of Keynes. Inevitably this concern for authenticity has generated much controversy, enveloping Keynesian economics in a 'doctrinal fog(Blaug, I980, P. 221). This paper attempts to pierce that Keynesian doctrinal fog. The central thesis is that the causes of the controversy surrounding Keyness General Theory lie, in part, in the different presuppositions made about the nature of interpretation. It is argued that much light can be shed on the Keynesian debate by drawing on the study of hermeneutics. The structure of the paper is as follows. Section I discusses the atomistic view of interpretation which is implicitly presupposed by most contributors to the Keynesian debate. Two variants of the atomistic view are considered the objectivist/essentialist approach and the relativist approach. Section II provides an alternative presupposition, the organicist view of interpretation, as exemplified by Ricoeur's dialectical approach in hermeneutics. The paper concludes in Section III with a re-examination the Keynesian debate in the light of the organicist view of interpretation . THE ATOMISTIC VIEW OF INTERPRETATION A principal aim of Keynesian economics has been to give a definitive answer to the question 'What does Keynes's General Theory really mean?'. Much of the resulting controversy arises from the nature of the question itself. In asking the question an atomistic view of interpretation is presupposed. The author, the text and the reader are treated as individual atomistic entities which are inter related in a purely external manner: the author produces the text which the reader interprets. There are two variants of the atomistic view of interpretation the objectivist/essentialist approach and the relativist approach This paper represents a development of themes contained in Gerrard I should like to thank Paul Brothwell, Meghnad Desai, Athol Fitzg John Hillard, Brian Hillier and the participants at the res conference as well as the editors and an anonymous referee for much in the yay of helpful criticism. The usual disclaimer applies
MARCH I99I] KEYNESS GENERAL THEORY 77 I.I. The Objectivist/Essentialist Approach From the perspective of the objectivist/essentialist approach, the aim of interpretation is the rational reconstruction of the text in order to recover the author's original meaning. Interpretation is seen to be problematic because the author's meaning is hidden. The latency of the original meaning creates confusion and generates the possibility of multiple interpretations. The task of the interpreter is to resolve this confusion by discovering the'true' meaning of a text. This presupposes that the true meaning is knowable Within the objectivist/essentialist approach, Ke eyes s ener viewed as containing a single essential meaning which is hidden as the result of the confusion created either by Keynes himself or by the economics profession in its reading of Keynes. The belief that Keynes's General Theory contains a single essential meaning is shared by most interpreters of Keynes. Leijonhufvud (I968)claims to have found the 'economics of Keynes' as opposed to Keynesian economics,, while Shackle(1967, ch 12)seeks Keynes'sultimate meaning. Fender(1981)sets out to find the ' exact nature of the theoretical contribution of Keynes'(pp I, 2) and, similarly, Chick(1983)attempts to remedy the fact that the ' macroeconomics that has been developed after Keynes, though claiming inspirations from the General Theory, in my view has not, with some outstanding exceptions, been macroeconomics after the manner of Keynes-with the method and perspective and insight of Keynes'(p v) From the objectivist/essentialist perspective, it is necessary to explain wh the essential meaning of the General Theory is hidden. There are three broad types of explanation I)The confusion is author-generated A number of writers have suggested that Keynes himself is the cause of the onfusion. There are a number of variants of this'author-generated confusio (i)Technical incompetence. It is often argued that Keynes had limited analytical abilities. For example, Hahn(1982, pp x, xi)writes that 'I consider that Keynes had no real grasp of formal economic theorising(and also disliked it), and that he consequently left many gaping holes in his theory. 'This follows famous remark by Shove that Maynard had never spent the twenty minutes necessary to understand the theory of value(quoted in Robinson, I964, p 79 (ii)Thevision thesis. Confusion arises as the inevitable consequences of the difficulties which Keynes faced in trying to formulate his underlying vision in a precise analytical manner. It is a line of argument originating wit Schumpeter(1946, p. 5o1)who distinguishes between Keynes's vision, that is his 'view about the basic features of society, about what is and what is not important'and Keyness technique, that is, the ' apparatus by which he conceptualises his vision and which turns the latter into concrete propositions or theories. According to Schumpeter the General Theory is the final result of a long struggle by Keynes to make his vision analytically operative. Leijonhufvud
THE ECONOMIC JOURNAL MARCH (pp. IO, II)adopts Schumpeter's distinction, arguing that Keynes was not entirely successful in translating his vision into a logically watertight model (iii)Stylistic difficulties. Keynes is often accused of a lack of clarity. This suggested by O'Donnell(Ig8ga, P. 6) as a reason for the difficulties in the interpretation of Keynes. O,Donnell approvingly quotes Wittgenstein's maxim that if anything can be said, it can be said clearly. Leijonhufvud(pp. IO, II) s far as to say that the General Theory is 'a badly written book ' and that epairs'has led to confusion because different writers have corrected Keynes's model in inappropriate ways. It is also argued that Keyness style is too loose and vague. This echoes Whiteheads criticism of Keynes's dissertation on probability as using the style of literature, not the style of logic and philosophy (iv)Inconsistencies. Some writers have suggested that Keynes did not have a coherent and consistent vision. It is an argument used by Leijonhufvud but also by Robinson (1973, p, 3)in her well-known comment that 'there were moments when we had some trouble in getting Maynard to see what the point of his revolution really was recent extreme example of the author- generated confusion'thesis is the neo-Ricardian argument that Keynes made a mistake in retaining the neoclassical concept of the marginal efficiency of capital (Milgate, I982). This created the possibility that, if the rate of interest is sufficiently low, there will be sufficient investment to maintain full employment. According to Milgate this undermined the principle of effective demand, the essence of the General Theory. Furthe ermore it forced Keynes to develop explanations of interest rate maladjustment; hence Keynes's misguided emphasis on expectations and liquidity preference. 2) The confusion is reader-generated An alternative explanation of the confusion surrounding the General Theory is to focus on the actions of the audience. Again there are a number of variants this explanation (i)Inappropriate framing. Readers have interpreted Keynes relative to inappropriate frame of reference. This results in the development of a variety of'subjective'interpretations based on personal beliefs and ideological and normative biases. In the process the objective meaning of Keynes becomes lost. This line of argument is epitomised by Leijonhufvud,'s distinction betwee Keynesian economics'and the 'economics of Keynes. It is an argument repeated by Fitzgibbons(1988, Pp. I-5) when he points towards the problem of 'systematically biased interpretation (ii)Selective reading. a closely related variant to the inappropriate framing rgument is the problem created by readers considering only parts of the text Thus O'Donnell (1989a, p. 4)sees the main reason for the multiple parts,rather than the whole of his relevant writing@ erpretations on selected interpretations of Keynes as the 'tendency to base int ii)Reliance on secondary sources. The tendency towards multiple interpret- tions of Keynes has been exacerbated by the tendency to read about Keynes rather than to read Keynes himself
] KEYNES S GENERAL THEORY (3)The confusion is generated by diferences in the composition of the stock of relevant Different interpretations may arise because of differences between interpreters th regard to the definition of the text to be analysed. There are two variants of this expla ana tion (i)Which lext? With an author as productive as Keynes, an inevitable problem is whether to interpret the target text in isolation or in the context of the author's other related writings. This can lead to multiple interpretations if readers find inconsistencies between different texts. The definition of ' other relevant writings may vary between interpreters, particularly with regard to the relative weights to be attached to earlier and later writings as well as to formal writings and more informal sources such as speeches, unpublished papers and private correspondence. Thus, for example, the recent emergence of Keynesian fundamentalism associated with Carabelli(Ig88) Fitzgibbons( 1988)and O'Donnell (198ga)amongst others, represents a shift of weight in favour of Keynes's early philosophical papers, a source largely ignored by previous interpreters (ii) Changes in availability. Not only can there ubjective'differences about the definition of the text, there may also be 'objective'differences over time as the stock of documents available for interpretation changes. Such changes have been particularly important in the interpretation of Keyness General Theory. The publication of the Collected Writings, especially volumes XIII and XIV, shed considerable light on the development of Keynes's thought immediately before and after the publication of the General Theory. The stock of de Its expanded subsequently with the publication of volume XXIX as the result of the discovery of a laundry basket of previously unknown papers by Keynes. These included early drafts of the General Theory focusing or e concept of a monetary production economy arious sources of confusion create the possibility of multiple interpretations. Convergence towards the correct interpretation is usually presumed to be ensured by the use of consistency with the textual evidence as the criterion of choice between competing interpretations(for example, Leijonhufvud, I968, P. 8). Interpretation is viewed, therefore, as a scientific problem. The scientific nature of interpretation has been highlighted by Stigler (I965)with particular reference to the problem of multiple interpretations Ricardo. Stigler argues that hand-picked quotations are insufficient to validate any particular interpretation. He proposes instead the use of two different principles of interpretation: the principle of scientific exegesis and the principle of personal exegesis. Scientific exegesis is interpretation which aims to maximise the value of a text to the science. In this case the text of an interpretation is its consistency with the main analytical conclusions of the author. This type of ed with form of the amended form of the text which removes 'blemishes such as logical tautologies. Personal exegesis, on the other hand, aims to discover the author really believed and thus the test of an interpretation consistency with the author's style, that is, what the author actually wrote
THE ECONOMIC JOURNAL MARCH According to Stigler this latter form of interpretation is of no direct relevance to scientific progress. Stigler's separation of scientific and personal exegesis has been the subject of recent criticism by Aksoy(Ig8g) and Hollander(1g89). Both question whether scientific exegesis can really be considered as interpretation when it denies any significance to what the author really believed. Hollander criticises scientific exegesis for leading to the distortion of an authors writings since it justifie disregarding those parts of an author's writings deemed by the interpreter to be'blemishes'. Hollander describes this as a 'lazy man's procedureand argues for the need to explain the 'residuals,, that is, the differences between the strong 'form of the text and what the author actually wrote The controvery surrounding Stigler's scientific approach to interpretation is suggestive of an important, but often overlooked, characteristic of interpret ation. 'Consistency with the textual evidence' is inadequate as an objective criterion for assessing competing interpretations. The definition of both consistency'and 'textual evidence'is open to debate. The textual evidence may be defined as the single target text only or it may include other relevant texts. Likewise'consistency'is open to multiple interpretation. Stigler suggests two alternative definitions: consistency with the author's main conclusions (i.e scientific exegesis) and consistency with the e author s beliefs (i.e. personal exegesis). Recently O Donnell(1989.b) has proposed a three stage consistency test for any interpretation of Keynes. According to O'Donnell, interpretations should be: (i) internally consistent;(ii)consistent with quotations taken context; and (iii)consistent with all of an authors writings. This definition of consistency appears to be unnecessarily restrictive in at least two ways. First, it seems to impose on an author's writings a degree of integration and continuity over time which may be unwarranted. Secondly, it seems to exclude evidence drawn from sources other than the author's own writings Thus the choice between competing interpretations cannot be purely objective. Such choices presuppositions. Any particular interpretation has a conventional foundation, a set of presuppositions which are treated as beyond doubt. This conventional foundation includes presuppositions about the aims of interpretation, the consistency criterion and the relevant evidence. Different writers their interpretations on different conventional foundations. Furthermore the very presupposition that the author's meaning is hidden provides the means by which any particular interpretation can be rendered consistent with the text. Any apparent inconsistency between an interpretation and the text can be explained away as the result of author-generated confusion. The objectivist, essentialist approach has a built-in immunising stratagem with which to protect the validity of any particular interpretation. The parallel with recent developments in the philosophy of science is clear. The Duhem-Quine thesis on the underdeterminacy of empirical testing has led to the recognition that science consists of theoretical structures with conventional foundations as exemplified by Kuhn's theory of paradigms and Lakatos's notion of scientific research programmes with hard cores
I99I KEYNES S GENERAL THEORY 1. 2. The Relativist Approach The contradictions within the objectivist/essentialist approach to interpret- ation have led some to adopt the relativist approach. Rather than viewing interpretation as the discovery of the author's meaning hidden within the text the relativist approach treats interpretation as the product of the reader imposed on the text. Thus the analysis of interpretation moves from being text- centred to being reader-centred. There is no single essential meaning within a text, only a variety of reader-determined meanings. Interpretations are always relative to the frame of reference within which the reader is operating. This implies that there is no objective standard for a rational evaluation of alternative interpretations. The choice of interpretation is made by the individual reader on the basis of a subjectively determined frame of reference Any interpretation can only ever be treated as consistent with its owl underlying frame of reference. In this sense, one interpretation is as good From the relativist perspective, to ask the question 'What does Keynes's General Theory really mean? "is really to ask What does kema sinerpretation General Ther mean to me, given my frame of reference ?'. Readers choose which makes sense within their own world-view. For example, since the neo- Keynesians adopt the choice-theoretic and market-theoretic perspective of mainstream economic theory, it follows that they interpret Keynes's general Theory to be dealing with the effects of imperfections such as non-atomistic market structures or imperfect information which prevent the price mechanism from operating effectivel The relativist approach, however, also suffers from self-contradictions. To lopt the relativist approach is to accept that the interpretive process is determinate. Relativism implies that 'anything goes; consistency with the text is always relative to a subjectively determined frame of reference. This validity of the process of interpretation itself into question. The relativist approach denies that interpretation can be the pursuit of under- tanding beyond that which is relative to the individuals own frame of reference. But this runs counter to the explicitly stated aims of those who engage in interpretation. Interpretations are advanced on the basis of intellectual and cognitive properties which are deemed to transcend subjectivist In order to justify the public presentation of an interpretation, interpreters adopt an objectivist/essentialist approach when advocating their own particular interpretations. Relativism cannot be followed consistently since it would deny the intellectual properties which interpreters always claim for their own interpretations. Relativism is a position that can be entertained but never occupied. The relativist approach, through the force of its own logic, becomes self-contradictory. Relativism always reverts to a form of back-door objectivism in which writers use the relativist approach to criticise the interpretations of others but claim authenticity for their own interpretations Practised in this form, relativism is but a variant of the 'reader-generated confusion' thesis
THE ECONOMIC JOURNAL IMARCH To summarise: Much of the confusion surrounding the interpretation of Keynes's General Theory arises from the presupposed atomistic view of interpretation. The atomistic view, in both its objectivist/essentialist and relativist forms, is self-contradictory. These contradictions have been carried over into the interpretation of Keynes. Thus the task of piercing the Keynesian doctrinal fog requires, as a first step, moving beyond the atomistic view of Interpretation. II. THE HERMENEUTIC APPROACH TO INTERPRETATION An alternative view of interpretation is the organicist view which stresses the importance of context. The writing and reading of texts are processes which are cially and historically contingent. The author, the text and the read not atomistic entities but form a dynamic whole in which the nature of any part is defined by its interrelationship with the other parts. It is a general vision of the process of interpretation which finds its expression primarily in the study of hermeneutics Hermeneutics is the study of interpretation. It originated as the study of the principles of biblical exegesis, deriving its name from Hermes, the messenger of he Gods. Gradually hermeneutics extended its scope beyond the confines of biblical exegesis, becoming the study of textual interpretation in general. It was systematised in the nineteenth century in the writings of Schleiermacher who set out the basic principles of hermeneutics. Schleiermacher stressed the importance of context, arguing that the historical conditions of the author must be taken into account in recovering the original meaning of the text. In particular, it was crucial to understand the original audience to whom the text was directed. Following Schleiermacher, hermeneutics became closely associated with the German historicist school, especially Dilthey, who came to regard the hermeneutic approach as a general methodology for the human sciences. During the twentieth century hermeneutics has undergone at least two marked changes in orientation. In the writings of Heidegger and Gadamer, hermeneutics emerged as a general philosophical position, becoming an integral part of the work of the Frankfurt School. Later hermeneutics took a linguistic turn, becoming synonymous with the structuralist approach to the study of language and symbol The ever-changing nature of hermeneutics means that there is no single coherent set of hermeneutic principles. Instead there are different conflicting traditions. Hirsch(1976) identifies three such traditions (i)The biblical/intuitionist tradition, in which the concern is for the 'spiritof the text. Meaning is seen as not fully expressible in words, implying that the understanding of a text requires getting behind the text. Schumpeter's notion of vision is suggestive of the intuitionist tradition. Interpretation is more than logical deduction. It requires intuition in order to achieve 'communion'with he spirit of the text. (ii)The legal/positivist tradition, in which the concern is for the 'letter of the law, that is, what is actually written. Meaning is seen as wholly contained
I99I KEYNESS GENERAL THEORY within the text and recoverable by means of logical deduction. It is a tradition which has its origins in part in Jewish Talmudic scholarship. The latter is explicitly invoked by Patinkin(I978)in support of his contention that the students of Keynes's thought should concern themselves only with what Keynes actually said (iii) The metaphysical tradition, in which the original meaning of the text is seen as unrecoverable, and, hence, unknowable. Given the seemingly nihilistic implications of the metaphysical tradition for the interpretive process, it is a tradition that has little parallel in the Keynesian debate Given these very different traditions in hermeneutics it is important from he outset that hermeneutics should not be seen as a set of unquestionable principles which can settle the debates over Keyness General Theory once and for all. Hermeneutics can be a double-edged sword a key concept in hermeneutics is the hermeneutic circle which arises from a general paradox within any organicist approach. To know the whole, one needs to know the parts. But the parts can only be known in the context of their interdependencies within the whole. Thus to know the whole requires that the whole be pre-known. This circularity has a'narrow'and sense In the narrow sense the text itself is treated as a whole while in the wider sense the text is treated as part of the historical context Within hermeneutics, the hermeneutic circle has been subject to two very different interpretations(Hirsch, 1976). The 'old'or'romanticist'her meneutics considers the aim of interpretation to be the recovery of the author's original meaning. The hermeneutic circle is the recognition of the need to understand the historical context of the text. In contrast the "new hermeneutics considers the hermeneutic circle as the rejection of objectivity nterpretation is always relative to the historical context of the reader. Thus just as with the atomistic approach to interpretation, the hermeneutic approach is caught in an objectivist-versus-relativist controversy An attempt to transcend the objectivist-relativist duality in hermeneutics is to be found in the writings of Ricoeur(1976, 1g81). Following Hirsch, Ricoeur views interpretation as a process of guess and validation in which interpreters marshall evidence to show a particular interpretation to be more or less obably true. Interpretation involves the logic of qualitative probability and uncertainty. However, unlike Hirsch, he does not view the aim of interpretation the recovery of the author's original meaning which he considers to be 'a lost sychical event. But the denial- of this objective standard does not entail that anything goes in interpretation. The text contains potential meaning to be actualised by readers but it constrains the possibilities of that actualisation. For is, hee interpretation is the appropriation of the reference power of a text, that ctualisation of a text's ability to disclose possible ways of looking at the world. Interpretation involves what Gadamer termed the fusion of horizons The world horizon of the reader becomes fused with the world horizon of the uthor with the text acting as the mediating link. The resultant interpretation is not the function of the text or the reader alone. Rather it is the outcome dialectical process
THE ECONOMIC JOURNAL MARCH From the writings of Ricoeur and others it is possible to develop a hermeneutic framework for the analysis of interpretation using the following definitions (i)under standing: the construction of a text's meaning in its own terms.s (ii)explanation: the presentation of the understood meaning in term accessible to a particular audience (iii)interpretation: the process of dynamic interaction between under standing and explanation; (iv)meaning: the outcome of the process of interpretation (v) judgement: the construction of a relation between the text and something external to it (vi)criticism: the explanation and evaluation of the judgement (vii)application: the process of dynamic interaction between judgement and criticism, (viii)significance: the outcome of the process of application For Ricoeur these concepts are abstract poles within a concrete whole Interpretation is a dialectic of understanding and explanation in which the understanding of a text affects its explanation and vice versa. Likewise application is a dialectic of judgement and criticism. At a higher level there is also a dialectical interaction between interpretation and application. The dialectical approach of Ricoeur and other related organicist analyses of interpretation are able to provide an alternative set of presuppositions about the nature of interpretation to that associated with the atomistic view. This alternative set of presuppositions can be formulated in terms of four propositions. PROPOSITION I. Interpretation is a multi-dimensional process with multiple objectives Interpretation involves understanding and explanation as well as judgemer and criticism. It aims not only to provide meaning to a text but also to evaluate the significance of the text. The complexity of interpretation needs to be ecognised by writers in order to overcome the confusion. This conclusion is drawn by Aksoy (1989, P. 744) in his application of the hermeneutic perspective to the debates surrounding the interpretation of ricardo: ..there a great deal of confusion about the meaning and the purpose of the act of interpretation. In most cases, interpreters are found to be careless and aconsistent about the differences between interpretation, judgement, evalu ation and application PROPOSITION 2. Interpretation is not an objective process but this does not imply that nything goes. There is no objective criterion of consistency with the textual evidence on which to base the rational evaluation of alternative interpretations. But anything does not go. The interpretive process is historically and socially contingent. Fish(Ig8o) argues that interpreters are social beings, constrained y the set of characteristic beliefs of the particular interpretive community which the interpreters belong. The interpretive community acts as the
