New Keynesian Economics, Volume 2

From Readings in Economics

New Keynesian Economics, Volume 2

Coordination Failures and Real Rigidities

Edited by N. Gregory Mankiw and David Romer





These two volumes bring together a set of important essays that represent a "new Keynesian" perspective in economics today. This recent work shows how the Keynesian approach to economic fluctuations can be supported by rigorous microeconomic models of economic behavior. The essays are grouped in seven parts that cover costly price adjustment, staggering of wages and prices, imperfect competition, coordination failures, and the markets for labor, credit, and goods. An overall introduction, brief introductions to each of the parts, and a bibliography of additional papers in the field round out this valuable collection. Volume 1 focuses on how friction in price setting at the microeconomic level leads to nominal rigidity at the macroeconomic level, and on the macroeconomic consequences of imperfect competition, including aggregate demand externalities and multipliers. Volume 2 addresses recent research on non-Walrasian features of the labor, credit, and goods markets.

ContributorsGeorge A Akerlof, Costas Azariadis, Laurence Ball, Ben S. Bernanke, Mark Bits, Olivier J. Blanchard, Alan S. Blinder, John Bryant, Andrew S. Caplin, Dennis W. Carlton, Stephen G. Cecchetti, Russell Cooper, Peter A. Diamond, Gary Fethke, Stanley Fischer, Robert E. Hall, Oliver Hart, Andrew John, Nobuhiro Kiyotaki, Alan B. Krueger, David M. Lilien, Ian M. McDonald, N. David Mankiw, Arthur M. Okun, Andres Policano, David Romer, Julio J. Rotemberg, Garth Saloner, Carl Shapiro, Andrei Shleifer, Robert M. Solow, Daniel F. Spulber, Joseph E. Stiglitz, Lawrence H. Summers, John Taylor, Andrew Weiss, Michael Woodford, Janet L. Yellen


Out of Print ISBN: 9780262132671 466 pp. | 6 in x 9 in


$45.00 X ISBN: 9780262631341 466 pp. | 6 in x 9 in


N. Gregory Mankiw

N. Gregory Mankiw is Professor of Economics at Harvard University.

David Romer

David Romer is Herman Royer Professor of Political Economy at the University of California, Berkeley.


  • These papers make a strong collective impression. I don't see how anyone could absorb them and just go back to frictionless competitive modelling.

    Robert M. Solow

    Institute Professor, MIT

  • This collection is exactly what the profession needs—an expertly chosen set of fundamental articles laying out the modern approach to macroeconomics.

    Stanley Fischer

    Professor of Economics, MIT