The General Theory of Employment, Interest, and Money

“I have called this book the General Theory of Employment, Interest and Money, placing the emphasis on the prefix general.”

Keynes underscores his intention to supersede the narrow, “special-case” scope of classical economics. By accentuating the universalizing word “general,” he signals a more comprehensive framework that he believes better reflects real-world economic conditions.

“I shall argue that the postulates of the classical theory are applicable to a special case only and not to the general case […] its teaching is misleading and disastrous if we attempt to apply it to the facts of experience.”

Keynes explicitly warns that classical theory—long accepted as universal—fails to account for the complexity of modern economic life. This statement sets the tone for his broader argument that a reevaluation of entrenched assumptions is both necessary and urgent.

“We need to throw over the second postulate of the classical doctrine and to work out the behaviour of a system in which involuntary unemployment in the strict sense is possible.”

Keynes explicitly calls for abandoning the belief that real wages can always adjust to eliminate joblessness. This declaration marks a pivotal shift from classical models, insisting that a new framework must accommodate the reality of workers willing to labor but still unable to secure employment.