Pierangelo Garegnani: Policy Implications of the Critique of Political Economy Notwithstanding his fundamental contribution to the critique of the neoclassical notion of capital, we maintain that Pierangelo Garegnani’s research has been especially characterized by the reconstruction of an alternative approach to economics. Following Sraffa’s lead, Garegnani found such an alternative approach in the Classical theory of value and distribution, and put forward a Classical-Keynesian theory for output determination. In this approach, prices are not scarcity indexes, the absence of any spontaneous tendency to full employment abolishes optimality of market economies, income distribution results from social − not natural − forces. The policy implications of this approach are considered.
Keywords: Pierangelo Garegnani, Piero Sraffa, Capital theory, Classical surplus approach, Effective demand
Jel Code: B320, D300, D460, E110