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In response to Robert Leeson:
It is precisely not the case, in the 'Keynesian' world for which the IS/LM model and hence
the AD curve is constructed, that any causal nexus exists between M and P. The IS and LM
components of the story are each 'fixprice' models (as Hicks called them). Hence a 'mental
experiment' in which one analyses the logical consequences of changing M whilst P remains
constant is entirely proper.
Anthony Waterman
Boston College
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