[9] Contrary to the views of new Keynesian economists working in the neoclassical tradition, post-Keynesians do not accept that the theoretical basis of the market's failure to provide full employment is rigid or sticky prices or wages.
This view has largely been incorporated into mainstream economics and monetary policy, which now targets the interest rate as an instrument, rather than attempting to accurately control the quantity of money.
Much of Nicholas Kaldor's work was based on the ideas of increasing returns to scale, path dependence, and the key differences between the primary and industrial sectors.
[19] Paul Davidson[20] follows Keynes closely in placing time and uncertainty at the centre of theory, from which flow the nature of money and of a monetary economy.
Monetary circuit theory, originally developed in continental Europe, places particular emphasis on the distinctive role of money as means of payment.
[21][22][23][24] Modern Monetary Theory is a relatively recent offshoot independently pioneered by Warren Mosler that models the currency itself as a public monopoly as the micro foundation of macro economics, thereby augmenting the theory of effective demand, recognizing that coercive taxation drives the currency (the tax credit) and that the price level is necessarily a function of prices paid by the state.
Subsequent MMT associated academics have used macroeconomic modelling of Wynne Godley and incorporated some of Hyman Minsky's ideas on the labour market, as well as chartalism and functional finance.
work in post-Keynesian economics has attempted to provide micro-foundations for capacity underutilization as a coordination failure, justifying government intervention in the form of aggregate demand stimulus.