2 But, with the benefit of hindsight, we now know that Shackle was a little too pessimistic when he predicted that the natural rate could become as obsolete as the steam locomotive. Modern monetary theory – as embodied in the latest generation of New-Keynesian macroeconomic models, for example – proves that the opposite is true.
It is not by accident that Michael Woodford’s textbook – which became sort of a standard work in modern monetary theory – carries the title “Interest and Prices” - the English translation of the title of Wicksell’s book ’Geldzins und Güterpreise’.