nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2012‒12‒10
four papers chosen by
Karl Petrick
University of the West Indies

  1. Public Debt and Functional Finance in an OLG Model with Imperfect Competition By Peter Skott; Soon Ryoo
  2. On Keynes's Z-function By Strati, Francesco
  3. From Marxian school of economic thought to system paradigm in economic studies: the institutional matrices theory By Kirdina, Svetlana
  4. Twenty Five Methodological Issues in Memory of Mark Blaug By Richard G. Lipsey

  1. By: Peter Skott (University of Massachusetts, Amherst); Soon Ryoo (Adelphi University)
    Abstract: This paper examines the role of fiscal policy in the long run. We show that (i) dynamic inefficiency may be empirically relevant in a modified Diamond OLG model with imperfect competition, (ii) fiscal policy may be needed to avoid inefficiency (if investment adjusts passively to saving) and maintain full employment (if investment and saving decisions are taken separately), (iii) a simple and distributionally neutral tax scheme can maintain full employment in the face of variations in 'household confidence', and (iv) the debt ratio is inversely related to both the growth rate and government consumption. JEL Categories: E62, E22
    Keywords: Public debt, Keynesian OLG model, dynamic efficiency, confidence, sustainability
  2. By: Strati, Francesco
    Abstract: This paper is intended to give a general, but rigorous view about what is the Z-function and what are the hidden relations of the Keynes’s General Theory. In Section 1 I shall depict the concept of probability and that of the weight of argument, in Section 2 I shall introduce quite an important definitions such as the Z-function is different from the Z∗-curve, and some paramount notions. The Section 4 is intended to grasp the importance of the chapters 20-21 of the General Theory, whereas in Section 5 I shall comment, very quickly, some properties of Z∗ in a topological view.
    Keywords: Keynes; Z-Function
    JEL: E12 B16
    Date: 2012–11–29
  3. By: Kirdina, Svetlana
    Abstract: The paper discusses some theoretical-methodological basis for the institutional change analysis in transitional countries. First, the paper shows the specific approach of the Marxian school of economic thought to the analysis of social and economic institutions. Second, the most general features of the system paradigm in economic theory (Kornai, 1998) are presented. Third, the institutional matrices theory, or IMT (Кирдина, 2001; Kirdina, 2001, 2010, etc.), developing Marxian approach and systemic ideas, is presented. An explanatory power of IMT is shown by the analysis of post-soviet reforms in Russia and East-European countries.
    Keywords: institutions; economic systems; Marxian approach; institutional matrices
    JEL: B10 B14 B15
    Date: 2012–08
  4. By: Richard G. Lipsey (Simon Fraser University)
    Abstract: This paper discusses twenty five methodological issues covering selected areas of both micro and macroeconomics. Included on the micro side are issues related to modelling the price system, assessing its efficiency, competing models of competition, modelling technological change and economic growth, dealing with risk and uncertainty, and policies related to R&D support, picking winners, and support of infant industries. Included on the macro side are issues related to the alleged refutation of old fashioned Keynesian economies by the stagflation of the 1970s, the use of the Dixit Stiglitz model of monopolistic competition in macro models, the current imperative that all the micro behaviour underling macro relations be based on dynamic inter-temporal optimization, the downplaying of fluctuations in aggregate demand as a driver of cyclical fluctuations, and the interpretation of the economy’s recent behaviour.
    Keywords: methodology, welfare economics, micro economic policy, Keynesian economics, New Classical economics
    JEL: B41 D01 D04 D60 O30
    Date: 2012–11

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