An Orthodox Appraisal of the ‘Employment-Tariff’ Proposition

In Chapter 3, Godley’s protectionism was discussed in macroeconomic terms. As stated there, it is rather odd that a one-period (short-to-medium term) Keynesian framework should be employed to formulate a long term stable equilibrium model. Therefore, in spite of Godley’s assertions to the contrary, the application of neo-classical concepts for an appraisal of his proposition is inevitable. The purpose of this chapter is to do precisely that in a brief and concise fashion — see Chapter 5 for a political economy approach.