nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2008‒04‒04
three papers chosen by
Karl Petrick
University of the West Indies

  1. Financialization in Kaleckian economies with and without labor constraints By Soon Ryoo; Peter Skott
  2. Hopf bifurcation for the discrete - delay Kaldor - Kalecki model By Loretti I. Dobrescu; Dumitru Opris
  3. Social Preferences and Public Economics: Mechanism design when social preferences depend on incentives By Samuel Bowles; Sung Ha Hwang

  1. By: Soon Ryoo (University of Massachusetts, Amherst); Peter Skott (University of Massachusetts, Amherst)
    Abstract: Most Kaleckian models assume a perfectly elastic labor supply, an assumption that is questionable for many developed economies. This paper presents simple labor- constrained Kaleckian models and uses these models to compare the implications of financialization under labor-constrained and dual-economy conditions. The paper complements the analysis in Skott and Ryoo (2008) which did not include labor- constrained Kaleckian economies. We show that for plausible parameter values the financial changes commonly associated with financialization tend to be expansionary in both dual-economy and labor-constrained settings. JEL Categories: E12, E44
    Keywords: financialization, stock-flow consistency, labor constraints, Kaleckian model.
    Date: 2008–03
  2. By: Loretti I. Dobrescu (Università di Padova); Dumitru Opris (West University of Timisoara)
    Abstract: The present work will focus on a Kaldor - Kalecki non - linear business cycle model in income and capital, with discrete time and delay argument characteristics. What it will state, considering an investment function similar to the one proposed by Rodano and using the linear approximation analysis, are the local stability property and local bifurcations conditions, given the parameter space. Numerical examples will be given in the end, to support the theoretical results obtained.
    Keywords: business cycle, Hopf bifurcation, discrete-delay time
    Date: 2008
  3. By: Samuel Bowles (Santa Fe Institute, University of Siena and University of Massachusetts); Sung Ha Hwang (University of Massachusetts, Amherst)
    Abstract: Social preferences such as altruism, reciprocity, intrinsic motivation and a desire to uphold ethical norms are essential to good government, often facilitating socially desirable allocations that would be unattainable by incentives that appeal solely to self-interest. But experimental and other evidence indicates that conventional economic incentives and social preferences may be either complements or substitutes, explicit incentives crowding in or crowding out social preferences. We investigate the design of optimal incentives to contribute to a public good under these conditions. We identify cases in which a sophisticated planner cognizant of these non-additive effects would make either more or less use of explicit incentives, by comparison to a naive planner who assumes they are absent. JEL Categories: D52, D64, H21. H41
    Keywords: Social preferences, implementation theory, incentive contracts, incomplete contracts, framing, motivational crowding out, ethical norms, constitutions
    Date: 2008–03

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