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on Post Keynesian Economics |
| By: | Pavlina R. Tcherneva |
| Abstract: | The job guarantee (JG) is finally getting the public debate it deserves, according to Pavlina R. Tcherneva, and criticism is expected. Following the Levy Institute's latest report analyzing the economic impact of a JG proposal and providing a blueprint for its implementation, Tcherneva responds to alarmist claims that the JG is (1) an expensive big-government takeover, (2) unproductive and impossible to manage, (3) dangerously disruptive to the private sector, and (4) inflationary. |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:lev:levyop:op_55&r=pke |
| By: | Guglielmo Chiodi (Sapienza University of Rome (IT)) |
| Abstract: | The standpoint of the old classical economists as well as of Marx “has been submerged and forgotten since the advent of the ‘marginal’ method” – to borrow Sraffa’s own words. The neoclassical (or ‘marginal’) paradigm, in fact, triumphantly dominated over the twentieth century (and is still dominating even now). A serious step towards the rehabilitation of the paradigm of the old classical economists was made by Sraffa (1951) with his remarkable ‘Introduction’ to Ricardo’s Principles, his seminal 1960 book Production of Commodities by Means of Commodities (PCMC) followed a few years later, as a logical completion of his long-standing work. The paper here proposed argues that Sraffa’s 1960 contribution has so far been mainly interpreted and used as a highly powered tool for destroying the foundations of neoclassical theory from a logical point of view, with the confident belief that attacking the logical side of the theory would have been sufficient to bring about its definite dismissal, which, instead, did not happen. As a consequence of all this, the revival of the classical economists and of Marx – which is one of the most characterizing feature of Sraffa’s 1960 contribution – was automatically silenced and this very fact precluded Sraffa’s theoretical framework from being used in a constructive way as a real alternative ‘vision’ to that proposed by the neoclassical market-centered paradigm. The aim of the paper is to underscore the crucial importance of Sraffa’s revival referred to above, by emphasizing its usefulness in providing a genuine alternative perspective and a radically different representation of the economy, compared with that provided by neoclassical theory. An attempt will be made to show the main features of the Sraffian framework in providing such an alternative ‘vision’ which, it will be argued, is now much needed, not least for suggesting far more sensible alternative economic policies than those so far pursued in the ceaseless turmoil of present day world economies. |
| Keywords: | Adam Smith, Ricardo, Marx, Sraffa. |
| JEL: | A10 B12 B14 B24 B51 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:saq:wpaper:4/18&r=pke |
| By: | Ertürk, Korkut Alp; Mendieta-Muñoz, Ivan |
| Abstract: | Much of macroeconomic theorizing rests on assumptions that define the short-run output adjustment of a mass-production economy. The demand effect of investment on output, assumed much faster than its supply effect, works through employment expanding pari passu with changes in capacity utilization while productivity remains constant. Using linear Structural VAR and Time-Varying Parameter Structural VAR models, we document important changes in the short-run output adjustment in the USA. The link between changes in employment, capacity utilization and investment has weakened, while productivity became more responsive following demand shifts caused by investment since the early 1990s. |
| Keywords: | changes in short-run output adjustment, capacity utilization, employment, mass-production economy, post-Fordism. |
| JEL: | B50 E10 E32 |
| Date: | 2018–06–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:87409&r=pke |
| By: | - |
| Abstract: | Consistently with the emphasis that the Economic Commission for Latin America and the Caribbean (ECLAC) has placed on equality since 2010, and in keeping with the purpose of leaving no one behind enshrined in the 2030 Agenda for Sustainable Development, this document examines the mechanisms by which inequality erodes dynamic inefficacy in the Latin American and Caribbean economies. It analyses and measures the productivity and income effects of unequal access to health and education, as well as the consequences of inequality of opportunities arising from gender-, race- or ethnicity-based discrimination. It also examines how these inequalities play out at the level of territory, infrastructure and urban dynamics, where their costs not only weigh on productivity, but also worsen energy inefficiencies and environmental degradation, thereby compromising the development possibilities of present and future generations. Inequality imposes constraints on innovation and creativity that are all the heavier because they are embedded within the culture of agents, which creates a culture of privilege in which many public goods and rights are not universal, but denied to much of the population. This weakens trust in social interactions and in democratic institutions. Here, ECLAC proposes strategic guidelines for increasing the dynamic efficiency of the Latin American and Caribbean economies on the basis of equality. Capacity-building and the construction of welfare States are at the heart of a new development paradigm that puts the technological revolution at the service of low-carbon, technology-intensive growth. In this regard, and in view of the rapid transformations and mounting uncertainties in the global economy, the region urgently needs stronger public and private investment revolving around an environmental big push in order to diversify its production structure and even out its structural disparities. |
| Keywords: | DESARROLLO ECONOMICO, DESARROLLO SOCIAL, IGUALDAD, GLOBALIZACION, RELACIONES ECONOMICAS INTERNACIONALES, MULTILATERALISMO, EMPRESAS TRANSNACIONALES, INVERSIONES, EMPLEO, POLITICA FISCAL, CRECIMIENTO ECONOMICO, POBREZA, DISTRIBUCION DEL INGRESO, IGUALDAD DE OPORTUNIDADES, DESARROLLO REGIONAL, MEDIO AMBIENTE, CIUDADES, CAMBIO CLIMATICO, FUENTES DE ENERGIA RENOVABLES, CONDICIONES POLITICAS, GOBERNABILIDAD, DEMOCRACIA, MACROECONOMIA, POLITICA DE DESARROLLO, ECONOMIA DEL BIENESTAR, POLITICA SOCIAL, POLITICA INDUSTRIAL, POLITICA ENERGETICA, INNOVACIONES, INDICADORES ECONOMICOS, INDICADORES SOCIALES, INDICADORES AMBIENTALES, ECONOMIC DEVELOPMENT, SOCIAL DEVELOPMENT, EQUALITY, GLOBALIZATION, INTERNATIONAL ECONOMIC RELATIONS, MULTILATERALISM, TRANSNATIONAL CORPORATIONS, INVESTMENTS, EMPLOYMENT, FISCAL POLICY, ECONOMIC GROWTH, POVERTY, INCOME DISTRIBUTION, EQUAL OPPORTUNITY, REGIONAL DEVELOPMENT, ENVIRONMENT, CITIES, CLIMATE CHANGE, RENEWABLE ENERGY SOURCES, POLITICAL CONDITIONS, GOVERNANCE, DEMOCRACY, MACROECONOMICS, DEVELOPMENT POLICY, WELFARE ECONOMICS, SOCIAL POLICY, INDUSTRIAL POLICY, ENERGY POLICY, INNOVATIONS, ECONOMIC INDICATORS, SOCIAL INDICATORS, ENVIRONMENTAL INDICATORS |
| Date: | 2018–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecr:c39025:43443&r=pke |
| By: | Giovanni Caggiano (University of Padova); Efrem Castelnuovo (University of Padova); Olivier Damette (BETA-CNRS); Antoine Parent (Sciences Po Lyon); Giovanni Pellegrino (University of Melbourne) |
| Abstract: | This paper estimates a nonlinear Threshold-VAR to investigate if a Keynesian liquidity trap due to a speculative motive was in place in the U.S. Great Depression and the recent Great Recession. We find clear evidence in favor of a breakdown of the liquidity effect after an unexpected increase in M2 in the 1921–1940 period. This evidence, which is consistent with the Keynesian view on a liquidity trap, is shown to be state contingent. In particular, it emerges only when a speculative regime identified by high realizations of the Dow Jones index is considered. A standard linear framework is shown to be ill-suited to test the hypothesis of a Keynesian liquidity trap. An investigation performed with the same data for the period 1991–2010 confirms the presence of a liquidity trap just in the speculative regime. This last result emerges significantly only when we consider the federal funds rate as the policy instrument and we model the Divisia M2 measure of liquidity. |
| Keywords: | Keynesian liquidity trap, Threshold-VAR, Monetary and financial cliometrics, Great Depression, Great Recession |
| JEL: | B22 C52 E52 N12 N22 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:pad:wpaper:0221&r=pke |
| By: | - |
| Abstract: | The 2030 Agenda for Sustainable Development reflects a consensus on the need to move towards more egalitarian, cohesive and solidarity-based societies, and calls for ensuring that “no one will be left behind” on the road to development. The regional commissions of the United Nations have come together to prepare this report, which synthesizes regional findings and lessons learned in the conceptualization, design and implementation of public policies and programmes oriented towards greater equality. As this report highlights, inequality includes —but transcends— income inequality and relates to the uneven exercise of rights, unequal access to opportunities and capacity development, and unequal results. Social inequality gives rise to adverse social, environmental and economic consequences, stratified by economic status, age, sex, disability, race, ethnicity, origin or religion. However, social inequality can be successfully addressed and is not an inevitable outcome. Promoting greater equality through adequate social protection, health, education, labour and fiscal policies not only helps to safeguard the economic, social and cultural rights of all people, but also fosters growth, development and greater social justice. |
| Keywords: | DESARROLLO ECONOMICO, IGUALDAD, POBREZA, DISTRIBUCION DEL INGRESO, POLITICA SOCIAL, SEGURIDAD SOCIAL, DESARROLLO SOCIAL, GENERO, GRUPOS DE EDAD, DISCRIMINACION RACIAL, ZONAS URBANAS, ZONAS RURALES, SALUD, EDUCACION, EMPLEO, POLITICA FISCAL, SECTOR INFORMAL, INTEGRACION SOCIAL, INDICADORES ECONOMICOS, INDICADORES SOCIALES, AGENDA 2030 PRA EL DESARROLLO SOSTENIBLE, ECONOMIC DEVELOPMENT, EQUALITY, POVERTY, INCOME DISTRIBUTION, SOCIAL POLICY, SOCIAL SECURITY, SOCIAL DEVELOPMENT, GENDER, AGE GROUPS, RACIAL DISCRIMINATION, URBAN AREAS, RURAL AREAS, HEALTH, EDUCATION, EMPLOYMENT, FISCAL POLICY, INFORMAL SECTOR, SOCIAL INTEGRATION, ECONOMIC INDICATORS, SOCIAL INDICATORS, 2030 AGENDA FOR SUSTAINABLE DEVELOPMENT |
| Date: | 2018–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecr:col022:43677&r=pke |
| By: | Christoph E. Boehm (University of Texas, Austin) |
| Abstract: | I show that a large and conventional class of macroeconomic models predicts that short-lived government investment shocks have a much smaller fiscal multiplier than government consumption shocks. I test this prediction in a panel of OECD countries using real-time forecasts of government consumption and investment to purify changes in purchases of their predicted components. Consistent with theory, I estimate a government investment multiplier near zero and a government consumption multiplier of approximately 0.8. These findings suggest that fiscal stimulus packages which contain large government investment components may not be as effective at stimulating aggregate demand as commonly thought. |
| Keywords: | Fiscal multiplier, Durable goods, Investment, Government spending, Government investment, Government consumption |
| JEL: | E21 E32 E62 E63 |
| Date: | 2018–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:mie:wpaper:662&r=pke |
| By: | Jean-Bernard Chatelain (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Kirsten Ralf (Ecole Supérieure du Commerce Extérieur - ESCE - International business school) |
| Abstract: | A number of macroeconomic theories, very popular in the 1980s, seem to have completely disappeared and been replaced by the dynamic stochastic general equilibrium (DSGE) approach. We will argue that this replacement is due to a tacit agreement on a number of assumptions, previously seen as mutually exclusive, and not due to a settlement by "nature". As opposed to econometrics and microeconomics and despite massive progress in the access to data and the use of statistical softwares, macroeconomic theory appears not to be a cumulative science so far. Observational equivalence of different models and the problem of identification of parameters of the models persist as will be highlighted by examining two examples: one in growth theory and a second in testing inflation persistence. |
| Keywords: | Macroeconomic theory,controversies,identification,economic growth,convergence,inflation persistence,B22, B23, B41, C52, E31, O41, O47 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01720655&r=pke |
| By: | Krenz, Astrid; Prettner, Klaus; Strulik, Holger |
| Abstract: | We propose a theoretical framework to analyze the offshoring and reshoring decisions of firms in the age of automation. Our theory suggests that increasing productivity in automation leads to a relocation of previously offshored production back to the home economy but without improving low-skilled wages and without creating jobs for low-skilled workers. Since it leads also to increasing wages for high-skilled workers, automation induced reshoring is associated with an increasing skill premium and increasing inequality. Using a new measure of reshoring activity and data from the world input outputtable, we find evidence for a positive association between reshoring and the degree of automation. On average, within manufacturing sectors, an increase by one robot per 1000 workers is associated with a 3.5% increase of reshoring activity. We also provide evidence that reshoring is positively associated with wages and employment for high-skilled labor but not for low-skilled labor. |
| Keywords: | Automation,Reshoring,Employment,Wages,Inequality,Tariffs |
| JEL: | F13 J31 O33 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:351&r=pke |