Keynesian economist embraces anti-Keynesian Pigou effect, challenging economic theory.
The article explores how Don Patinkin, a supporter of Keynes, incorporated the Pigou effect, an anti-Keynesian concept, into his theory of involuntary unemployment. By analyzing Patinkin's unpublished PhD thesis and papers from Duke University's archives, it was found that he changed his views on this topic. The integration of the real balance effect into Keynesian economics was actually an effort to strengthen it, shedding new light on the development of the 'neoclassical synthesis'.