Keynes and the Confidence Fairies

John Considine, David Duffy

Research output: Contribution to journalArticlepeer-review

5 Citations (Scopus)


Budgetary constraints were never the primary object of policy for John Maynard Keynes. They were constraints, not objectives. However, Keynes identified the psychological channels through which budgetary discipline and other policy conventions might influence investment. He even accepted that in rare circumstances the psychological factors might overwhelm direct policy interventions. Unfortunately, the polarisation of the current debate means traditional Keynesians are unlikely to search out this aspect of his work and the confidence faeries are unlikely to read any of Keynes’s work. This article draws attention to this aspect of his work.
Original languageEnglish
Pages (from-to)309-325
JournalCambridge Journal of Economics
Issue number1
Early online date17 Dec 2014
Publication statusPublished (in print/issue) - 6 Jan 2016


  • Expansionary fiscal contraction
  • Keynes
  • Financial Crisis
  • Economic Thought


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