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on Post Keynesian Economics |
| By: | Eric Bengtsson; Engelbert Stockhammer (King’s College London) |
| Abstract: | Wage restraint plays an important role in the conventional economic history explanation of the post-war golden growth experience of industrialized economies. Conversely, wage increases harming investment and increasing unemployment have been proffered as explanations for some of the high unemployment during the interwar period. This article argues that the conventional account implicitly only considers effects of wage growth on investment and not the advantageous effects on consumption. Thus, the evaluation of the effects on GDP growth is lop-sided. We employ a Post-Keynesian model to estimate effects of growth in the wage share of national income on consumption, investment, exports and imports separately, and weigh the effects together to estimate total effects on GDP growth, in Scandinavia (Denmark, Norway and Sweden) 1900–2010. Furthermore, we estimate the positive effects of wage pressure on productivity, showing it to be significant and positive in all three countries. We show that the postwar wage push had small positive effects on GDP growth in Denmark and Sweden, and a small negative effect in Norway. Thus, wage restraint is not a valid explanation for the postwar growth miracle. We propose a more comprehensive macroeconomic framework for understanding the implications of labour-capital distribution. |
| Keywords: | functional income distribution, inequality, consumption, investment, Scandinavia, Bhaduri-Marglin model, economic history |
| JEL: | E12 N10 N14 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:pke:wpaper:pkwp1811&r=pke |
| By: | Parui, Pintu |
| Abstract: | In post-Keynesian literature, Hein (2012a) was the first to incorporate financialization as an influential positive determinant of the rate of technological change. However, financialization is more like a two-edged sword which can affect technological progress negatively as well. We capture both the positive as well as the negative effect of financialization on technological progress which encapsulates the possibility of multiple equilibria. In analyzing the long run of the model we endogenize the financialization parameter as well. We then show how two subsystems (technological progress and financialization dynamics) when interact with each other, can produce instability and cycles for the whole system. We show that under certain circumstances, higher speed of diffusion of technological innovation, more regulated financial markets, and higher intra-class competition among firms are desirable for stabilizing the economy. Finally, we provide some policy prescriptions for the same. |
| Keywords: | Capital accumulation, Distribution, Financialization, Kaleckian model, Technological progress, Andronov–Hopf bifurcation, Saddle-node bifurcations, Limit cycles |
| JEL: | C62 C69 D33 E12 G01 O16 O41 |
| Date: | 2018–10–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89351&r=pke |
| By: | Douglas Alcantara Alencar (UFPA); Frederico Gonzaga Jayme Jr. (Cedeplar-UFMG); Gustavo Britto (Cedeplar-UFMG) |
| Abstract: | This research analyses, from a Post-Kaleckian perspective, the interactions among the aggregate demand, the real exchange rate, productivity and real wages in the Brazilian economy from 1960 to 2011. It adopts the longstanding perspective that demand is the driver of capital accumulation and economic growth. The research comprises the following steps: i) a critical assessment of the growth regime literature, with a particular emphasis on issues related to productivity and the real exchange rate; ii) understanding the relationship between the real exchange rate and the productivity and growth regimes; iii) proposing a theoretical model that relates the real exchange rate, productivity and the growth regime; and iv) an empirical test of the interaction between the real exchange rate, productivity and the growth regime. Theoretically the study develops a model showing the interactions between the aggregate demand, the real exchange rate, productivity and real wages. Furthermore, this research attempts to address the lack of theoretical and empirical studies about the relationship between the aggregate demand, the real exchange rate, productivity and real wages. |
| Keywords: | Post-Kaleckian, aggregate demand, real exchange rate, productivity, real wages. |
| JEL: | O11 O15 O41 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td588&r=pke |
| By: | Fahd Boundi Chraki |
| Keywords: | Valor; precios de producción; transformación; invariante; iteración. Value; prices of production; transformation; invariant; iterative method |
| JEL: | B14 B24 B51 |
| Date: | 2018–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000418:016779&r=pke |
| By: | Alexandre Mendes Cunha (Cedeplar-UFMG) |
| Abstract: | Although seldom remembered in this respect, François Perroux exerted direct and indirect influence on the debate on European integration in the immediate post-war period in France. The theme of European integration serves in Perroux’s work as a concrete case study on which a series of his recurrent themes could be explored, such as his theory of domination, his reflection on economic spaces, development and the costs of man ("coûts de l’homme"), or even as an extension of topics from his work in the 1930s related to corporatism and communitarianism. Perroux deals with the theme of European integration fundamentally in an extensive book from 1954, L’Europe sans rivages, but also in several others of his books and articles from the period, forming a complex and multifaceted analysis of the problematic that, nevertheless, insists in a central message: the importance of the global aspect of the European integration, thinking in a Europe of the “five parts of the world”. This paper offers an analysis of this set of writings, connecting it to the institutional and political context of the debate on European integration in France. The goal is to situate the effective influence Perroux’s ideas and his concrete personal influence on important names of Jean Monnet entourage. Taking these general questions as a reference, and starting with Perroux’s perspectives on topics such as national accounts, planning and liberal interventionism, the article also explores the critical thinking undertaken by Perroux, throughout the 1950s, on the institutional and political paths taken in the first years of the European integration process, approximating his analysis to other voices that critically discussed those paths, such as, for example, Gunnar Myrdal. Doing this, the paper also explores important connections, not frequently visited in the literature of the history of economic ideas, between the European integration and the field of economic development or regarding the debates on regional inequalities that took shape in the midst of the postwar European reconstruction projects. |
| Keywords: | François Perroux, Jean Monnet, European integration, Postwar Europe, National accounts, planning, liberal interventionism. |
| JEL: | B29 B31 B59 F02 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td590&r=pke |
| By: | Lambert, Thomas |
| Abstract: | This research note performs some limited empirical assessments of the Baran and Sweezy (1966) contention that most research and development (R&D) efforts in the US are “wasted” at the macroeconomic level in that as R&D succeeds by absorbing a little of the excess economic surplus generated by a capitalist system, it still fails to generate a lot of innovation of a transformative nature. At an aggregate level, greater R&D efforts are correlated with higher worker productivity and standards of living, which is to be expected according to mainstream economic theory and literature. Yet, R&D efforts regarding job creation, new firm creation, and net business investment show either mixed results or even negative connections. There is some preliminary empirical support in this paper for many aspects of the Baran and Sweezy point of view on R&D, and these findings also hint that R&D is used in a monopoly capital system to further monopolization. The findings of this note also may help to explain how productivity gains and innovation over the last few decades may not be benefitting the typical worker or the creation of small businesses as well. |
| Keywords: | big business, corporations, entrepreneurship, innovation, monopoly capital, research and development |
| JEL: | B51 B52 B53 L22 L26 O40 |
| Date: | 2018–10–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89503&r=pke |
| By: | Virginie Gouverneur |
| Abstract: | A section of Mill’s Principles (1848) is about women’s low wages. Contemporary commentators who have studied it minimize its normative content. According to them, Mill’s belief in the naturalness of the traditional sexual division of roles prevent him from proposing efficient remedies to male-female wage differentials and occupational segregation by sex. We propose another reading of Mill’s analysis, as a protest against power relations which, pervading Victorian society, cause wage differences unjustified by differences in efficiency. Its focus is not occupational segregation by sex. Mill addresses the issue elsewhere, then identifying distinct causes of women’s limited entry into skilled occupations. |
| Keywords: | John Stuart Mill, gender pay gap, discrimination, occupational segregation by sex. |
| JEL: | B1 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2018-43&r=pke |
| By: | Douglas Alcantara Alencar (UFPA); Frederico Gonzaga Jayme Jr. (Cedeplar-UFMG); Gustavo Britto (Cedeplar-UFMG) |
| Abstract: | This paper aims to discuss the theory of productivity growth and its empirical applications, several authors emphasize the impact of real exchange rate devaluation on productivity. The main research question is: does the real exchange rate have a positive or negative impact on productivity growth? The first step in answering this question is to discuss productivity growth in the context of demand regimes. The second step consists of an empirical experiment that estimates the productivity growth equation for a sample of Latin American countries. The overall outcome is that the Kaldor–Verdoorn coefficient is significant for all the analysed countries, Argentina, Brazil, Bolivia, Chile, Colombia, Mexico, Uruguay and Venezuela. The wage-push variable is significant for only two countries, Bolivia and Chile, indicating that in Bolivia the regime is profit-led whereas in Chile it is wage-led. Regarding the real exchange rate and this variable squared, the parameters are negative for all the countries, indicating that real exchange rate devaluation does not increase productivity growth. |
| Keywords: | Post-Kaleckian, aggregate demand, real exchange rate, productivity, real wages. |
| JEL: | O11 O15 O41 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td587&r=pke |
| By: | Douglas Alcantara Alencar (UFPA); Frederico Gonzaga Jayme Jr. (Cedeplar-UFMG); Gustavo Britto (Cedeplar-UFMG); Claudio Puty (UFPA) |
| Abstract: | In this article we analyze, from a Latin American structuralist perspective, whether productivity growth is affected by growth in income and employment. In order to test our hypothesis, we have chosen a sample of Latin American countries that represent 86% of the region’s gross domestic product. We perform an econometric test of the so-called Kaldor-Verdoon parameter and the employment growth parameter for the selected countries. |
| Keywords: | Demand-led growth, Endogenous technological change, Wage-led and profit-led demand regimes, Productivity regime, Latin American structuralism. |
| JEL: | O4 O3 E3 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td589&r=pke |
| By: | Jael, Paul |
| Abstract: | This paper focuses on the debate held in the twenties and thirties of the last century between libertarian economists and socialist economists, following the denial by the first ones of the feasibility of a socialist economy. This controversy is well known to specialists and has been widely commented. It seemed to me useful to initiate non-specialists in an original way: by having the controversy speaking by itself. We review the main contributions and summarise their arguments with, initially, the bare minimum of personal comments. Walrasian general equilibrium serves as a reference for the defenders of market socialism in the controversy. But the concept of competition behind this theory is very incomplete; it is purely passive. It follows that the market socialism which emanates from it is not really a MARKET socialism. It is lacking the competition which innovates. Markets for capital goods are also lacking in theses models. Our paper then turns to a new generation of socialist models involving this real competition. We review two models proposed by Bardhan and Roemer and then exhibit a personal model. This type of model is facing a modern criticism whose central concept is the "soft budget constraint". |
| Keywords: | planification, socialisme de marché, calcul socialiste, Barone, von Mises, Hayek, Lange, Roemer |
| JEL: | P20 P21 P27 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89521&r=pke |
| By: | Karl Betz; Traductor Hernando Matallana |
| Keywords: | El capital; Marx; Keynes. Capital; Marx; Keynes. |
| Date: | 2018–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000418:016784&r=pke |
| By: | Linus Mattauch; David Klenert; Joseph E. Stiglitz; Ottmar Edenhofer |
| Abstract: | Wealth inequality is rising in rich countries. Capital taxation used simply to finance redistribution may not be able to counteract this trend, but can increased public investment financed by higher capital taxes? We examine how such a policy affects the distribution of wealth in a setting with distinct wealth groups: dynastic savers and life-cycle savers. Our main finding is that public investment financed through capital taxes always decreases wealth inequality when the elasticity of substitution between capital and labor is moderately high. Indeed, for all elasticities of substitution greater than a threshold value, at high enough capital tax rates, dynastic savers disappear in the long run. Below these rates, both types of households co-exist in equilibrium with life-cycle savers gaining from the higher capital tax rates. These results are robust with respect to the different roles of public investment in production. We calibrate our model to OECD economies and find the threshold elasticity to be 0.82. |
| JEL: | D31 E21 H31 H41 H54 |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25126&r=pke |