Heterodox Johan Gustaf Knut Wicksell (December 20, 1851 – May 3, 1926) was a Swedish economist of the Stockholm school.

His father's considerable estate allowed him to enroll at the University of Uppsala in 1869 to study mathematics, astronomy and physics.

In 1887, Wicksell received a scholarship to study on the Continent, where he heard lectures by the economist Carl Menger in Vienna.

Although he was sometimes identified as a socialist, his solution to the problem was decidedly Malthusian in advocating birth control, which he would defend to the end of his life.

Wicksell's (1898, 1906) theory of the "cumulative process" of inflation remains the first decisive swing at the idea of money as a "veil" as well as Say's law.

[6] Wicksell's most influential contribution was his theory of interest, originally published in German language as Geldzins und Güterpreise, in 1898.

[8] Wicksell's theory of the "cumulative process" of inflation remains the first decisive swing at the idea of money as a "veil".

Recall that the start of the Quantity theory's mechanism is a helicopter drop of cash: an exogenous increase in the supply of money.

Wicksell's main thesis, that disequilibrium engendered by real changes leads endogenously to an increase in the demand for money – and, simultaneously, its supply as banks try to accommodate it perfectly.

Finally, for Wicksell the endogenous creation of money, and how it leads to changes in the commodity market is fundamentally a breakdown of the Neoclassical tradition of a dichotomy between monetary and real sectors.

Parts of Wicksell's ideas would be expanded upon by the Austrian school, which used it to form a theory of the business cycle based on central bank policy – changes in the level of money in the economy would shift the market rate of exchange in some way relative to the natural rate, and thus trigger a change in the relative proportion of the production of consumer goods to investment, which would ultimately result in an economic correction, or recession, in which the proportion of production of consumption goods to investment in the economy is pushed back towards the level that the natural rate of interest would result in.

Wicksell's main intellectual rival was the American economist Irving Fisher, who espoused a more succinct explanation of the quantity theory of money, resting it almost exclusively on long run prices.

Wicksell's theory was considerably more complicated, beginning with interest rates in a system of changes in the real economy.

Elements of his public policy were taken strongly to heart by the Swedish government, including his price-level targeting rule during the 1930s (Jonung 1979) and his vision of a welfare state.

Wicksell's contributions to economics have been described by some economists, including historian-of-economics Mark Blaug, as fundamental to modern macroeconomics.

[3] After giving a lecture in 1908 satirising the Virgin birth of Jesus, Wicksell was deemed guilty of blasphemy and imprisoned for two months in 1910.