This paper presents a simple agent-based computational laboratory aimed at testing the verbal insights on business cycles contained in the well-known Chapter 22 of Keynes’ General Theory. Our analysis departs from the construction of a very simple IS-LM framework, in which a population of heterogeneous and autonomous agents take investment decisions by forming expectations on the relationship between the money market interest rate and the marginal efficiency of capital. Simulation results demonstrate that our model is able to recreate economic fluctuations at business cycle frequencies, opening the way to interesting policy implications.

• Legal notice:
  

  Copyright (c) Pielaszek Research, all rights reserved.
  The above materials, including auxiliary resources, are subject to Publisher's copyright and the Author(s) intellectual rights. Without limiting Author(s) rights under respective Copyright Transfer Agreement, no part of the above documents may be reproduced without the express written permission of Pielaszek Research, the Publisher. Express permission from the Author(s) is required to use the above materials for academic purposes, such as lectures or scientific presentations.
  In every case, proper references including Author(s) name(s) and URL of this webpage: https://science24.com/paper/14890 must be provided.