Behavioral Foundations for the Keynesian Consumption Function

Abstract

This paper has two main goals. The first is to show that behavioral rather than maximizing principles emerge from textual analysis as the microeconomic foundations for Keynes’s Consumption Theory; the second goal is to demonstrate that it is possible to ground a Keynesian-type aggregate Consumption function on the basis of (some of) the principles underlying contemporary behavioral modelsKeynes, Behavioral Economics, Keynesian Theory, Consumption, Hyperbolic Discounting, Mental Accounting