nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2021‒04‒05
five papers chosen by
Karl Petrick
Western New England University

  1. Keynes’s finance, the monetary and demand-led circuits: a Sraffian assessment By Sergio Cesaratto; Riccardo Pariboni
  2. Financialisation and macroeconomic regimes in emerging capitalist economies before and after the Great Recession By Akcay, Ümit; Hein, Eckhard; Jungmann, Benjamin
  3. Patterns of Growth in Structuralist Models: The Role of PoliticalEconomy By Porcile, Gabriel; Spinola, Danilo; Yajima, Giuliano
  4. Female economists and philosophers’ role in Amartya Sen’s thought: his colleagues and his scholars By Erasmo, Valentina
  5. Human Capital and Black-White Earnings Gaps, 1996–2017 By Owen Thompson

  1. By: Sergio Cesaratto; Riccardo Pariboni
    Abstract: This paper aims to stimulate the convergence of the Sraffian approach to demand-led growth theory with insights from monetary circuit theory and stock-flow models. The first Sraffian contribution to this convergence we identify is the extension of Garegnani’s interpretation of Keynes’ General Theory’s originality and limitations to Keynes’ 1937 papers on “finance.” In both cases, it is a question of freeing Keynes from the ties of marginalist theory. After discussing some troubles of the monetary circuit, we identify a complementarity between the Keynesian concept of finance, some insights of the monetary circuit, and the role attributed by the Sraffian take of demand-led growth to the autonomous components of demand (which are also Kalecki’s external markets). This seems to us to be the second Sraffian contribution to this convergence towards a monetary theory of demand-led growth.
    Keywords: Keynes, Finance, Monetary Circuit, Effective Demand, Supermultiplier
    JEL: B26 E12 E43 E50
    Date: 2021–03
  2. By: Akcay, Ümit; Hein, Eckhard; Jungmann, Benjamin
    Abstract: In recent years, diverging demand and growth regimes have received greater scholarly attention. In particular, the intersection between different variants of Comparative Political Economy and the post-Keynesian macroeconomic analysis provides a promising avenue for understanding the main dynamics of various growth regimes. Yet, the majority of these studies has focused on the global North. In this contribution, we expand this analysis to the global South by examining eight large emerging capitalist economies (ECEs) - Argentina, Brazil, China, India, Mexico, Russia, South Africa, and Turkey - during the periods 2000-2008 and 2009-2019. In so doing, we not only uncover the main demand and growth regimes of ECEs for the two periods, but also link these results to the main trends in the demand and growth regimes of developed capitalist economies (DCEs) for both periods. One of the main findings of our research is that ECEs did not follow the same path as DCEs after the Great Recession. While there was a clear shift in the demand and growth regimes of DCEs towards an export orientation, the main pattern in the ECEs remained the continuation of a trend that had already emerged before the 2007-09 crisis, i.e. domestic demand-led models. Finally, we provide some observations on the puzzle of resilient domestic demand-led models in ECEs.
    Keywords: demand and growth regime,financialisation,emerging capitalist countries,post-Keynesian economics,Argentina,Brazil,China,India,Mexico,Russia,South Africa,Turkey
    JEL: E11 E12 E65 F65
    Date: 2021
  3. By: Porcile, Gabriel; Spinola, Danilo; Yajima, Giuliano
    Abstract: This paper presents a set of growth and distribution models in developing countries which reflect distinct political economy regimes. These regimes give rise to different institutional frameworks that affect macroeconomic outcomes. We focus on three cases: (1) a pure developmentalist state, (2) conflicting claims between workers and the government, and (3) financialization under a neoliberal coalition. The equilibrium growth rate is defined, following the Keynesian tradition in open economy growth model, by the Balance-of-Payments constraint (Thirlwall, 1979). The paper relies on cumulative causation à la Kaldor in periods in which the depreciation of the real exchange rate raises temporarily the BOP-constrained equilibrium rate of growth. The transition between one equilibrium level of the RER to another allows (under certain conditions) for a process of learning that transforms the income elasticity of exports and hence the BOP-constrained rate of growth in the long run. The model produces a variety of outcomes that help explain the contradictory results reported in the empirical literature associated with different constellations of power and institutions.
    Keywords: Structural Change; Growth models; Structuralist models; BOP-constrained growth
    Date: 2021–03–26
  4. By: Erasmo, Valentina
    Abstract: The aim of this paper is to offer an insight about women’s role in Amartya Sen’s thought, privileging economists and philosophers: mainly, I will focus on the figures of Joan Robinson, Eva Colorni, Martha Nussbaum and Emma Rothschild, showing, on the one hand, how they have influenced his thought, on the other, how they have eventually developed their own welldefined ideas about common research themes. Finally, I will provide an overview about contemporary Sen’s female scholars who have reached international acknowledgments in this research in order to distinguish the most important schools of thought born around his reflection. The main result of this paper is that, on the one hand, Sen has favoured the enhancement of these female’s figures both in economics and philosophy; on the other, these female’s figures have undoubtedly and significantly influenced his own thought. Rather, it is better to talk of a mutual and peer influence to each other.
    Keywords: capability approach; female; feminist; sentiments.
    JEL: B20 B40 B54
    Date: 2021–02–05
  5. By: Owen Thompson (Williams College)
    Abstract: This paper estimates the contribution of human capital to the Black-white earnings gap in three separate samples of men spanning from 1966 through 2017, using both educational attainment and performance on standardized tests to measure human capital. There are three main findings. First, the magnitude of reductions in the Black-white earnings gap that occur after controlling for human capital has become much larger over time, suggesting a growing contribution of human capital to Black-white earnings disparities. Second, these increases are almost entirely due to growth in the returns to human capital, which magnify the impact of any racial differences in human capital levels, rather than to increasing racial gaps in the human capital traits themselves. Finally, growth in the explanatory power of human capital has been primarily due to increases in the association between human capital and the likelihood of nonwork, with no clear increases in the extent to which human capital explains Black-white wage differences. These findings highlight how apparently race-neutral structural developments in the U.S. labor market, such as increasing skill prices and falling labor force participation rates among less-skilled men, have had large impacts on racial inequity.
    Keywords: human capital, earnings gap, racial gap, black-white, NLS, decomposition
    JEL: J15 J24 J31 J71
    Date: 2021–03

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