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From the 1930s, economic controversy has been a tale of three cities (Chicago and the two Cambridges) and three General Theories. In the 1930s, there were, in addition to the General Theory of Employment (Keynesian Macroeconomics), two other revolutionary attempts to don the mantle of generality: the General Theory of Method (the formalist revolution, involving structural econometrics and Walrasian general equilibrium) and the General Theory of Value (organized around the concept of monopolistic, or imperfect, competition). The Keynesian and formalist general revolutions became symbiotic and dominated the postwar landscape of economists. In contrast, the monopolistic competition revolution did not readily lend itself to general equilibrium formalism and, so far, has yet to achieve its promise (Tinbergen, 1967: 268).

Friedman and the Walrasian Equations of the Natural-Rate Counter-Revolution