The strange persistence of the IS-LM model

Why has the IS-LM model persisted? In this essay I consider that ques-tion, along with the related, and in some ways more interesting, question of how the use of the IS-LM model has changed over time. I begin with some general issues about the persistence of IS-LM and how its treat-ment has changed, presenting some bibliometric evidence about the ap-pearance of IS-LM in the literature over the last forty years. Then I look specifically at how the treatment of IS-LM has evolved from the 1960s until today, comparing a 1960s intermediate macro text with a modern intermediate text. Finally, I relate that discussion to some thoughts about the future of the IS-LM model. Some General Comments on the Persistence of IS-LM IS-LM analysis is a creature of pedagogy, and to understand its persis-tence one must understand the nature of economic pedagogy in the in-termediate macro course, where the IS-LM model predominates. Since just about every economics student takes intermediate macro, just about every economist has taken intermediate macro, and so as long as IS-LM continues to be used in that course, IS-LM will retain its central role in rough-and-ready discussions of macro policy. IS-LM provides a com-mon framework (the “trained intuition”) that economists can use to dis-cuss macro policy, as suggested by James Tobin (1980), Robert Solow (1984), and others