Kalecki's 1934 model VS. the IS-LM model of Hicks (1937) and Modigliani (1944)

This article is based on Kalecki's * 1934 study entitled 'Three Systems'. It aims to show that before the General Theory Kalecki developed a mathematical model capable of expressing both the main conclusions of the neoclassical theory - Kalecki's Systems I and II - and the persistence of unemployment - Kalecki's System III. The present analysis stresses the relevance and the originality of Kalecki's 1934 model by comparing it to the two main variants of the IS-LM model - Hicks (1937) and Modigliani (1944) - around which the neoclassical synthesis was built. It shows that although there does indeed exist a formal proximity between Kalecki's model and those of Hicks and Modigliani, Kalecki can be considered the first to offer an original explanation of the difference between classical and Keynesian models that depends neither on liquidity preference as proposed by Hicks nor on the rigidity of money wages as proposed by Modigliani.