Beyond Microfoundations: Post Walrasian Macroeconomics.

• Author: DeLorme, Charles D., Jr.

Is Post Walrasian macroeconomics an alternative paradigm to Keynesian and Classical economics, whatever the prefix, and to non-Walrasian economics, as well? David Colander, the editor of this volume, thinks so and has compiled a collection of twelve papers by various authors including himself to support his view and to encourage others to question and extend the Post Walrasian approach. Readers unfamiliar with Post Walrasian thinking need to begin with Colander's overview which preceeds the collection of papers. Post Walrasians reject the assumption of a unique equilibrium position and an unconstrained representative agent. Instead, they visualize an economy where multiple equilibria abound but can be stabilized and limited by institutions. The institution plays the key role in constraining the representative agent in Post Walrasian analysis. As Colander says, "Spelling out those constraints is one of the tasks Post Walrasians have set out for themselves" [p. 9]. Included also in the overview is a brief description of each paper in the volume and of an appendix consisting of an annotated bibliography.

The volume is divided into four sections. The first section consists of papers by Clower and Howitt, Leijonhufvud, and Colander which present the vision behind Post Walrasian macro. Readers may already be familiar with Leijonhufvud's paper since it appeared in the Southern Economic Journal in 1993. His point is that Walrasian economics is a "top down" approach. What economists really need to do is to conceptualize from the "bottom up" as if the economy were "a network of interacting processors" [p. 42]. Colander's paper, which extends Leijonhufvud's "bottom up" idea, is entitled "The Macrofoundations of Micro" [Chapter 4]. What exactly does this title mean? After reading Colander's paper, one may still be puzzled since the answer seems to be hiding between the pages. But if readers jump to the annotated bibliography by van Ees and Garretsen, they will find out. According to the bibliographers, the macrofoundation of Post Walrasian economics is "centered around the concept of coordination failures" [p. 223]. They provide a section with a brief discussion of coordination failure including a brief review of the sources.

Section two consists of papers by Mehrling, Rosser, and Colander and provides the foundation of Post Walrasian macroeconomics. Rosser's paper is of particular interest since it defines and reviews chaos theory. It explains how the...