----------------- HES POSTING ----------------- Moss replies to Chas Anderson: I am not sure I understand the criticism. I said nothing about whether the rise in P causes the rise in M or vice versa. The fact that the rise in liquid balances is a necessary condition for sustaining the rise in P is a key platform of post-Smithian classical economic theory (I am following Samuel Hollander on this point). The history of economic thought is full of cost-push inflationists and refuting that line of thinking is, in my opinion, one of the most important contributions of the quantity theory tradition. My judgment is that textbook Keynesians --- those who "carried the Keynesian cross" into policy-making circles ---were most inclined to vulgar versions of cost-push inflation and that is why the quantity tradition represents a continuous tradition that disputes cost-push lines of argument. The context of my remarks was Professor Bateman's point that the quantity theory revival was a reaction to Keynesianism. My point is that Keynesianism (or more correctly vulgar Keynesianism) is a variation from a long-standing orthodox tradition. I am sorry I did not make that clear. L. Moss ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]