Nicholas Kaldor in Limitations Of The General Theory, published in Collected Economic Essays, Volume 9, first published 1982 on the role and importance of history in causation:
My purpose here is to show that many of the difficulties which emerged in the operation of Keynesian policies of demand management were due not to any defect in basic conception but to the failure of Keynes (and of his followers) to work out the full implications of his ‘paradigm’ of the economy as against the ruling ‘paradigm’ of neo-classical economics.
Keynes himself emphasized that the writing of his book was ‘one long struggle to escape from habitual modes of thought and expression … The difficulty lies not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds.’3
As far is possible within the confines of a lecture, I hope to demonstrate that the limitations of the General Theory derive more from a failure to escape from traditional modes of thought than from any basic defect in those aspects which were fundamentally new. Apart from his failure to cut himself loose from one of the main tenets of the quantity theory of money, with which I shall deal only briefly as I have discussed it extensively on earlier occasions, the three main aspect in which Keynes remained too much a follower of tradition concern: first, the micro-economic background, in other words, the implications for his theory of the way markets function; second, the regional or territorial aspect, the implications of inter-regional trade for the differing rates of employment-growth of different areas; and finally, the failure to recognize that owing to the importance of increasing returns in manufacturing, the development of an industrial system is largely self-generated, where, owing to a powerful feed-back mechanism, ‘events of the recent past can only be explained in terms of the actual sequence through which the system has progressed; history enters into the causation of events in an essential way’.4
3 General Theory, Preface, p. vii.
4 Cf. Jukka Pekkarinen, On The Generality of Keynesian Economics (Helsinski, 1979), p. 113. He adds that in consequence ‘it is not reasonable to view the economic process as allocating given resources wuth given technologies and preferences’.