Tracing the Political-Economy Background of The Contemporary Crisis

Abstract

Economics goes back a long way under shifting political conditions. The Keynesian state’s macro-economic form of intervention actions, which developed just after the Second World War, was a clear answer to the structural economic crisis of the inter-war period of the 1920s and 1930s. The Keynesian economic theory was in many senses deduced from classical economic theories. Correspondingly, today we see the Keynesian principles being transformed but prolonged, despite change of framework. The ongoing financial and dept crisis needs an answer of solution, and the answer seems to be found in principles which could be traced and identified as neo-Keynesianism and neo-interventionism. This paper is tracing and analyzing the political economy of the historical democratic capitalism.