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on Post Keynesian Economics |
| By: | Engelbert Stockhammer (Kingston University) |
| Abstract: | The paper offers an account of the Euro crisis based on post-Keynesian monetary theory and its typology of demand regimes. Neoliberalism has transformed social and financial relations in Europe but it has not given rise to a sustained profit-led growth process. Instead, growth has relied either on financial bubbles and rising household debt ('debt-driven growth') or on net exports ('export-driven growth'). In Europe the financial crisis has been amplified by an economic policy architecture (the Stability and Growth Pact) that aimed at restricting the role of fiscal policy and monetary policy. This neoliberal economic policy regime in conjunction with the separation of monetary and fiscal spheres has turned the financial crisis of 2007 into a sovereign debt crisis in southern Europe. |
| Keywords: | Euro crisis, neoliberalism, European economic policy, European integration, financial crisis, sovereign debt crisis |
| JEL: | E02 E12 E50 E60 F50 P16 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:pke:wpaper:pkwp1510&r=pke |
| By: | Dean Baker; Nicole Woo |
| Abstract: | As financial transactions taxes (FTT) have moved to be part of the mainstream debate on tax policy, there has been increased attention to the incidence of such taxes. This is an important aspect to the debate, since the merits of the tax will depend to a substantial extent on who will end up bearing the burden. |
| Keywords: | financial transactions tax, incidence, wall street, stock market, elasticity |
| JEL: | G G2 G28 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:epo:papers:2015-25&r=pke |
| By: | Alberto Botta (Mediterranean University of Reggio Calabria (IT)) |
| Abstract: | The existing criticism to the expansionary austerity theory has extensively addressed the methodological problems affecting the econometric techniques underpinning it, and hence the solidity of its empirical findings. Relatively fewer efforts have been spent in showing the theoretical inconsistencies of the expansionary austerity literature, i.e. the rather extreme assumptions and circumstances under which an expansionary fiscal correction episode might effectively materialize. In this paper, we try to further develop this second type of critique. We first present some stylized facts that seem to contradict the central pillars of the expansionary austerity building. We then move to the theory and provide a detailed analysis of the specific policy measures expansionary austerity supporters advocate to compose possibly successful austerity packages. We do so through a simple short-run model. We show that fiscal consolidation might have expansionary outcomes only under extreme, very specific and uncertain conditions. Expansionary austerity would hardly take place in the context of monetarily sovereign economies, or in presence of an accommodative monetary policy like that implemented by the ECB since late 2011, or into economic systems that are poorly integrated on international good markets and cannot manage their own exchange rate freely. |
| Keywords: | Fiscal policy, expansionary austerity theory, post-Keynesian macro models |
| JEL: | E12 E61 E62 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:pke:wpaper:pkwp1511&r=pke |
| By: | Kevin Hjortshøj O’Rourke |
| Abstract: | This is a revised version of the Keynes Lecture, presented at the British Academy on October 7, 2015. I am extremely grateful to Mary Morgan who chaired that event, and to Roger Backhouse, Patrick O’Brien, Richard Portes, Morten Ravn, Hélène Rey, and Donald Winch, who attended the lecture and made many useful suggestions and comments. I particularly want to thank Morgan Kelly and Alan Taylor for many conversations on the subject of secular stagnation; and to Bob Allen, Charlie Bean, Paul Beaudry, Agustín Bénétrix, Steve Broadberry, Nick Crafts, Brad DeLong, Rui Esteves, Ron Findlay, Mike Gavin, Richard Grossman, Leander Heldring, Svend Hylleberg, Philip Lane, Jacob Madsen, Perry Mehrling, Gian Maria Milesi-Ferretti, Cormac Ó Gráda, Thomas Piketty, Filipa Sa, Claus Vastrup, Karl Whelan, Jeff Williamson, and Nikolaus Wolf, for many useful comments, help with data, and advice. The usual disclaimer applies. |
| Date: | 2015–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:nuf:esohwp:_139&r=pke |
| By: | Arjun Jayadev; Rahul Lahoti; Sanjay G. Reddy |
| Abstract: | Interest in the emergence of a global middle class has resulted in a number of attempts to identify and enumerate who belongs to it . Current research provides wildly different estimates about the size and evolution of the global middle class because of a lack of consensus on appropriate identification criteria for a person to be deemed to be middle class. We identify three competing and often conflated understandings in the literature on the subject. We further argue that for at least two of these understandings, the literature has been using inappropriate thresholds for identification. Using data from the Global Consumption and Income Project, we provide estimates of the size, composition and evolution of the global middle class for three competing understandings and contrast these to existing estimates. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:mab:wpaper:2015_06&r=pke |
| By: | Arjun Jayadev; Rahul Lahoti; Sanjay G. Reddy |
| Abstract: | Using newly comprehensive data and tools from the Global Consumption and Income Project or GCIP, covering most of the world and five decades, we present a portrait of the changing global distribution of consumption and income and discuss its implications for our understanding of inequality, poverty, inclusivity of growth and development, world economic welfare, and the emergence of a global ‘middle class’. We show how regional distributions of income and consumption have evolved very differently over time. We also undertake sensitivity analysis to quantify the impact of various choices made in database construction and analysis. We find that levels of consumption and income have increased across the distribution, that the global distribution has become more relatively equal due to falling inter-country relative inequality, and that by some measures global poverty has declined greatly but by others it has hardly declined at all, even over the fifty years. The global middle class has grown markedly in certain countries but only slightly worldwide. Most of the marked changes have occurred after 1990. China’s rapid economic growth is by far the most important factor underlying almost all of them, notwithstanding sharply increasing inequalities within the country. Most improvements outside of China are associated with rapid developing country growth after 2000, and are of unknown durability. Country-experiences vary widely; there is for instance some evidence of ‘inequality convergence’ with previously more equal countries becoming less equal over time and the obverse. We provide support for previous findings (e.g. the replacement of the global ‘twin peaks’ by a unimodal distribution) but also arrive at some conclusions that overthrow old ‘stylized facts’ (e.g. that the Sub-Saharan African countries, and not Latin American ones, have the highest levels of inequality in the world, when measured using standardized surveys). The GCIP provides a resource for ongoing analysis, and forecasting, of developments in the world distribution. |
| JEL: | D30 D31 D60 D63 I30 O10 O15 P50 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:mab:wpaper:2015_04&r=pke |
| By: | Cristina BARNA (Institute of Social Economy - Civil Society Development Foundation, Romania); Ancuta VAMEsU (Institute of Social Economy Coordinator - Civil Society Development Foundation, Romania) |
| Abstract: | Credit unions are social economy entities that have an important contribution to preventing financial and social exclusion in Romania. Historically, we can speak about credit unions in Romania from XVIII century in Transylvania, until present. These social economy entities have been a considerable support during all these times for persons with low income in Romania, being credible institutions in the communist period, and also after 1990 Revolution, facing successfully all turbulent economic transformations and global challenges, adapting and developing themselves continuously until present, when they begin to embrace microfinance and adopt the European Code of good-practice in micro-finance. They have the potential to become a successful social economy model, very instrumental in providing affordable loans and safe saving and also contributing to local development through support for entrepreneurship and job creation. Our paper has as objective to describe and analyze the specificity of Romanian credit union model, that could be seen in the same time as a social innovation, with a big multiplier effect in economy and society, generating inclusive growth and development; an overview of the dynamics of the sector, considering the most recent available statistical data. The paper will include the preliminary research results of the project “ICAR - inclusion by micro-credit and mutual help - sustainable strategy of social economy for employment and creation of social enterprises”, financed by European Social Fund - Human Resources Operational Programme, ID 148102, regarding the general context of access to financial services in Romania, financial exclusion and over-indebtedness. |
| Keywords: | credit union, financial exclusion, social exclusion, social economy, mutual financial help, micro-credit |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:crc:wpaper:1511&r=pke |
| By: | Armando Barrientos (IPC-IG); Edmund Amann (IPC-IG) |
| Abstract: | "As the world begins to wake up to the dire social and economic consequences of rising inequality, we must recognise that it is not an inevitable side-effect of economic growth and development. Many Latin American countries, and Brazil in particular, have demonstrated it is possible to achieve inclusive growth, which has reduced inequality and poverty."(...) |
| Keywords: | Brazil, development |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:ifocus:33&r=pke |
| By: | Kornai, János |
| Abstract: | For two decades Hungary, like the other Eastern European countries, followed a general policy of establishing and strengthening the institutions of democracy, rule of law, and a market economy based on private property. However, since the elections of 2010, when Viktor Orbán's Fidesz party came to power, Hungary has made a dramatic U-turn. This article investigates the different spheres of society: political institutions, the rule of law, and the influence of state and market on one another, as well as the world of ideology (education, science and art), and describes the U-turn’s implications for these fields and the effect it has on the life of people. It argues against the frequent misunderstandings in the interpretation and evaluation of the Hungarian situation, pointing out some typical intellectual fallacies. It draws attention to the dangers of strengthening nationalism, and to the ambivalence evident in Hungarian foreign policy, and looks into the relationship between Hungary and the Western world, particularly the European Union. Finally, it outlines the possible scenarios resulting from future developments in the Hungarian situation. |
| JEL: | P14 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2015/21&r=pke |