nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2020‒05‒11
nine papers chosen by
Karl Petrick
Western New England University

  1. "Guaranteeing Employment during the Pandemic and Beyond" By Pavlina R. Tcherneva
  2. The surplus approach, Polanyi and institutions in economic anthropology and archaeology By Sergio Cesaratto; Stefano Di Bucchianico
  3. A note on financialization from a Classical-Keynesian standpoint By Stefano Di Bucchianico
  4. Growth models and the footprint of transnational capital By Kaczmarczyk, Patrick
  5. "Immigration Policy Undermines the US Pandemic Response" By Martha Tepepa
  6. Reforming capitalist democracies: Which way? By Bhaduri, Amit
  7. Inventories, Debt Financing and Investment Decisions: A Bayesian Analysis for the US Economy By Ettore Gallo; Gustavo Pereira Serra
  8. Closing the gender pay gap what role for trade unions? By Rubery, Jill.; Johnson, Mathew.
  9. "Household Consumption, Household Indebtedness, and Inequality in Turkey: A Microeconometric Analysis" By Ozlem Albayrak

  1. By: Pavlina R. Tcherneva
    Abstract: The ongoing job losses, already numbering in the tens of millions, and the mass unemployment that will remain once the COVID-19 crisis has passed are of our own making, argues Pavlina R. Tcherneva, created by our inability to conceive of policies that protect and create jobs on demand. There is another option: instead of capitulating to a world of guaranteed unemployment, we can demand policies that guarantee employment. During the pandemic, the government can protect jobs by acting as a kind of employer of last resort, while in the post-pandemic world it can create jobs directly via mass mobilization and a job guarantee. In this environment, backstopping payrolls, mass mobilization, and the job guarantee are three different but organically linked policies that aim to secure the right to decent, useful, and remunerative employment opportunities for all.
    Date: 2020–05
  2. By: Sergio Cesaratto; Stefano Di Bucchianico
    Abstract: This paper was inspired long ago by Jared Diamond (1997), and in particular by his extensive use of the concept of economic surplus as the key to the development of civilization. Unfortunately, Diamond does not mention the origin of the concept in classical and pre-classical economics, nor does he pay much attention to debates in economic anthropology about the role of economic analysis in studying primitive and ancient economic formations. These debates were the subject of a recent book by Cedrini & Marchionatti (2017), who dispute the neoclassical “imperialist” attempt to occupy the territory of economic anthropology. The authors rely on the institutionalist background provided by Karl Polanyi and his school and by other anthropologists of similar inspiration. Polanyians, however, fail to complete their institutional analysis by anchoring it to the changing modes of generation and distribution of the economic surplus. Yet their emphasis on the need to introduce institutions from the beginning, when speaking of economic surplus, should be taken into consideration by the classical surplus approach
    Keywords: surplus approach, economic anthropology, economic archaeology, Marx, Polanyi, Sraffa
    JEL: A12 B51 B52 Z13
    Date: 2020–04
  3. By: Stefano Di Bucchianico
    Abstract: In this paper we present a Classical-Keynesian viewpoint on financialization by using Garegnani’s ‘integrated wage-commodity sector’ method. We focus on three aspects. First, we argue that financial instruments such as derivatives have played the role of ‘luxury’ goods, unnecessary and/or detrimental to the direct and indirect production of the wage-basket. Second, we show that the accumulation of household debt can result in a higher normal rate of profit. Third, there is scope to reconsider the connection between financialization and labour market institutions, which makes labour bargaining strength wane. Labour market relationships need not be strictly tied to financialization.
    Keywords: financialization, household debt, labour market, rate of profit, financial markets
    JEL: B51 E44 F65
    Date: 2020–04
  4. By: Kaczmarczyk, Patrick
    Abstract: The definition of various growth models is the latest innovation of comparative capitalism (CC) research. Yet, the literature has its weaknesses in explaining the dynamics within and the interdependencies between different growth models. I argue that this weakness stems inter alia from an inadequate conceptualization of transnational corporations (TNCs). I provide empirical evidence on the footprint of international capital in the global economy and outline how including TNCs as a unit of analysis can help us to better understand economic outcomes. This leads to several implications for the growth models literature, which I conclude my argument with.
    Keywords: institutions and the macroeconomy,international business,multinational firms,political economy
    Date: 2020
  5. By: Martha Tepepa
    Abstract: Research Scholar Martha Tepepa explains how the US response to the COVID-19 crisis will be hindered by its approach to immigration policy. The administration’s "zero tolerance" immigration campaign creates a public health risk in the context of this pandemic, and the recent implementation of the "Inadmissibility on Public Charge Grounds" final rule penalizing noncitizen recipients of some social services will further restrict access to treatment and encumber the fight against the coronavirus.
    Date: 2020–04
  6. By: Bhaduri, Amit
    Abstract: The debate about how to reconcile political with economic democracy is translated in the framework of wage- and profit-led growth in this paper. The inherent tension between providing sufficient profit incentive to motivate investment by the capitalist class and maintaining electoral accountability to the economically less privileged majority is examined through an analysis of policies towards raising the social wage. The paper shows how wider circumstances characterising a regime as wage- or profit-led is of consequence for determining the possibility of combining a higher profit share with a higher social wage through the effectiveness of such policies.
    Keywords: Profit and wage led,social wage,investment,disinvestment,ideology
    JEL: E11 E12 H30 P16 H40
    Date: 2020
  7. By: Ettore Gallo (Department of Economics, New School for Social Research); Gustavo Pereira Serra (Department of Economics, New School for Social Research)
    Abstract: The recent debate in Post-Keynesian theories of investment has mainly focused on the endogenous nature of the degree of capacity utilization, overlooking Steindl’s and Minsky’s insights on the role of inventories and debt financing in shaping investment decisions. In order to fill this gap, this paper develops a Steindl-Minsky SFC model by including inventories, as well as firm’s deposits and debt financing into the investment function. The role of investment decisions in shaping economic growth is assessed by considering a model populated by five types of economic actors: workers, firms, rentiers, commercial banks and the central bank. First, business cycle fluctuations are investigated assuming a deterministic steady growth path in the long period, in line with recent developments in heterodox growth theory. Second, we simulate the model, calibrating it for the US economy.
    Date: 2020–05
  8. By: Rubery, Jill.; Johnson, Mathew.
    Abstract: The authors of the paper, Professor Jill Rubery and Mathew Johnson, examine the role trade unions can and are playing at different policy levels in respect of both overall wage and gender-specific wage inequality. Although the paper is developed primary for trade unionists engaged in wage setting and equal pay, it is also highly recommended for researchers, policy makers and other stakeholders, both in a developed and developing country context.
    Keywords: wage differential, women workers, equal pay, trade union role
    Date: 2019
  9. By: Ozlem Albayrak
    Abstract: This paper examines whether relative income and income inequality within reference groups affect household consumption. Using the explanations of consumption behavior based on Dusenberry's relative income hypothesis, we test if household consumption levels in Turkey are affected by the household's relative position and inequality in the reference group between 2005-12 by employing cross-sectional household-level data. We find that household consumption is negatively related to the relative income indicator after controlling for absolute income, and positively related to the income inequality of the reference group, as the literature suggests. The paper also shows that household indebtedness has a positive impact on household consumption when inequality in the reference group and the relative position of households are controlled for. We confirm that the results are not sensitive to chosen relative income indicators and income inequality.
    Keywords: Consumer Behavior; Inequality; Relative Income Hypothesis; Household Debt
    JEL: D12 D63

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