The New Classical Economics: Theory in the Slipstream of Neoliberalism

Abstract

This paper examines the history that binds together the early economic theory of the Walter Lippmann Colloquium and the Mont Pelerin Society of the interwar years and the New Classical Economics that developed in the 1970s. It draws the narrative between the nascent theory of neoliberalism and the rise of “scientistic” methodology in economics. The following argues that the early ideas of neoliberalism came to a head in economics through the creation of a positive economic science that separated the “political” from “economic” and that this was highly important in the restructuring of the role of the state in the neoliberal period.