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on Post Keynesian Economics |
| By: | Esteban Cruz-Hidalgo; Stuart Medina-Miltimore; Agustin Mario |
| Abstract: | This paper explores a development strategy for peripheral economies by advocating for a paradigm shift from traditional economic models that rely on accumulating foreign reserves. It proposes the job guarantee policy, an automatic stabilizer based on a reserve pool of employed individuals, as a cornerstone for fostering sustainable and inclusive growth. Grounded in Modern Money Theory (MMT), this study critiques the conventional approach that prioritizes external reserves and highlights the potential of MMT in offering a more autonomous development path for developing countries. A systematic review of the literature, using the PRISMA methodology, reveals significant disagreement between MMT advocates and critics, particularly regarding monetary sovereignty and the feasibility of implementing macroeconomic policies in peripheral economies. The study emphasizes that, while external constraints remain, the MMT perspective calls for flexible exchange rates (or, at least, discretionary intervention) and low interest rates as part of a broader strategy to reduce dependency on foreign currencies. The proposed approach prioritizes full employment, the mobilization of domestic resources, and structural transformation through policies like import substitution. It offers a more equitable and stable development path. Ultimately, this analysis underscores the potential of MMT-informed policies to enable sustainable development, despite challenges in implementation and political resistance. |
| Keywords: | Job Guarantee; full employment; sustainable development; flexible exchange rates; peripheral economies; Modern Money Theory; developmentalism; structuralism; Employer of Last Resort; macroeconomic policies |
| JEL: | B52 E52 E62 F63 O23 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:lev:wrkpap:wp_1101 |
| By: | Francesco Zezza; Gennaro Zezza |
| Abstract: | This paper investigates the implications of the European Union's revised fiscal governance framework for Italy, a country facing the dual challenge of high public debt and persistent economic stagnation. Using a Stock-Flow Consistent (SFC) macroeconometric model of the Italian economy (MITA), we assess the medium-term macroeconomic implications of the government Medium-term Fiscal-Structural Plan, and whether it aligns with debt stabilization and economic recovery goals. We show how the government expenditure path, consistent with the new Debt Sustainability Analysis, leads instead to an increase in debt/GDP. We perform alternative fiscal policy scenarios (higher/lower spending; higher/lower direct tax rate; and a policy mix of higher spending and higher tax rate) and look at the effects on growth and debt sustainability. Results highlight the trade-offs inherent in adhering to the revised fiscal rules, particularly the tension between achieving long-term debt reduction and supporting growth. |
| Keywords: | European Fiscal Rules; Debt Sustainability; Empirical Stock-Flow Consistent Models; Italy; Fiscal Policy |
| JEL: | C54 E12 E17 E44 E62 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:lev:wrkpap:wp_1082 |
| By: | Lukas Baeuerle (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Socio-Ecological Transformation Lab, Johannes Kepler University Linz, Austria); Michelle Meixieira Groenewald (School of Economic Sciences, North West University, South Africa) |
| Abstract: | The role of academic economics education in establishing and nurturing a monoculture of thought and action, emanating from this powerful discipline has been pivotal. However, as of today, there exists a vast array of pedagogical alternatives. These are contributing to an emerging pluriculture of future economics and future economies. The following chapter presents a framework to compare these pluralizing ambitions in (and of), economics education. Furthermore, we discuss in detail how recent trends in the debate are beginning to reflect economic education in the broader context of its socio-ecological pervasiveness. So too, we grapple with the process of reshaping it from an overtly imperialist tradition towards a decolonized and diversified domain, in terms of content, capabilities and didactics. Throughout the chapter we provide examples, databases and go-to manuals that have been established to foster pluralist economic education. This chapter does not diminish the challenges that exist in economics education but also seeks to point out instances where progress has been made, and offers avenues that exist for economic pluricultures to emerge. |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:ico:wpaper:172 |
| By: | Miguel D. Ramirez (Department of Economics, Trinity College) |
| Keywords: | comparative advantage, double factorial terms of trade, finance capital, organic composition of capital, prices of production, rate of profit, real wages, surplus value, labor values, monopoly, transfer of value, and unit labor costs. |
| JEL: | B14 B17 B51 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:tri:wpaper:2504 |
| By: | Jose Luis Oreiro |
| Abstract: | One of the main propositions of the new-developmentalist school is the idea the over-valued exchange rates – due to Dutch disease and the adoption of a growth model with foreign savings – hampers economic growth by reducing the manufacturing share in output, i.e., causing a process of deindustrialization and also provoking an unsustainable increase in the current account led by an increase in the manufacturing trade deficit that is not compensated by the increase in exports of primary goods due to their low income elasticity of demand (Bresser-Pereira, Oreiro and Marconi, 2015). The problem with this proposition is its incompatibility with the so-called Kaldor´s paradox, the empirical regularity discovered by Kaldor (1978) and confirmed by the subsequent empirical literature (Boggio and Barbiere, 2016) that a country manufacturing share in world´s manufacturing exports exhibits a negative correlation with the relative unit labour costs, which means that exchange rate devaluations that are able to reduce the relative real wages are associated with a decrease, rather than an increase, of a country manufacturing share in world´s manufacturing exports. The main objective of this article is to show that using the concept of industrial equilibrium exchange rate of Oreiro, Martins da Silva and Dávila-Fernandez (2020) article in a macro-Schumpeterian model developed by Fagerberg (2007) the Kaldor´s paradox can be explained as the result of an appreciation of industrial equilibrium exchange rate due to a reduction in the level of technological gap. In such a framework an overvaluation of exchange rate – relative to industrial equilibrium - continues to be harmful for economic growth, but appreciation of the industrial equilibrium exchange rate does not have such an effect. |
| Keywords: | Real Exchange Rate, Technological Gap, New-Developmentalism, Nicholas Kaldor |
| JEL: | O11 O14 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:pke:wpaper:pkwp2524 |
| By: | Wenli Cheng (Monash University) |
| Abstract: | This paper develops a stock-flow consistent model to study the effects of three types of bank credit: credit for production, credit for consumption, and credit for asset speculation.The main findings are: (1) Credit for production (the “good”) enables capital formation and the adoption of more productive technologies; (2) Credit for consumption (the “bad”) diverts some real savings from capital formation to consumption, resulting in lower total output and less individual wealth; and (3) Credit for speculation (the “ugly”) funds real wealth transfers that are unrelated to wealth creation. It can result in higher prices in the goods market, which harms all consumers including those who do not participate in asset speculation. |
| Keywords: | stock-flow-consistent model, credit creation, production loans, consumption loans, loans for asset speculation |
| JEL: | E12 G21 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:mos:moswps:2025-20 |
| By: | Cajas-Guijarro, John; Cajas-Guijarro, Daniel |
| Abstract: | This paper presents a four-dimensional extension of the Goodwin model of endogenous cycles that integrates wage inequality and underemployment. The model distinguishes two classes of workers differentiated by productivity, wage levels, and bargaining strength, and endogenizes the underemployment rate through a simplified power-balance mechanism between capital and labor. We establish well-posedness of the system by proving existence–uniqueness of solutions, positivity, and forward invariance on a compact admissible set. The interior equilibrium is characterized in closed form and shown to generically undergo a double Hopf (Hopf–Hopf) bifurcation. Using center–manifold reduction and a third-order normal form, we derive the amplitude equations governing the interaction between two oscillatory modes (the Goodwin cycle and the underemployment cycle). The reduced dynamics predict the emergence of an invariant two-torus with quasi-periodic cycles and phase locking at low-order resonances ($1{:}1$, $1{:}2$, $1{:}3$). Numerical continuation and direct simulations corroborate the analytical predictions, documenting transitions between quasi-periodicity and resonant periodic orbits, and mapping the associated bifurcation structure in key parameters, such as the adjustment speed of the underemployment rate in response to deviations from steady-state equilibrium. |
| Keywords: | Goodwin model; Wage inequality; Stability; Double Hopf bifurcation; Normal form; Resonance |
| JEL: | B51 C61 E32 O41 |
| Date: | 2025–11–07 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126746 |
| By: | boughabi, houssam |
| Abstract: | This paper develops a Keynesian stochastic framework to reassess the natural rate hypothesis in the context of the Sri Lankan economy. By embedding fractional Brownian motion to capture persistent inflationary shocks and incorporating nonlinear interactions between unemployment dynamics and aggregate demand, the model contrasts expansionary Keynesian policies with the monetarist view of structural unemployment. Empirically, the estimated income series indicates that targeted income interventions can systematically reduce unemployment over time, illustrating the capacity of demand-side policies to stabilize labor markets. The results suggest that fiscal and monetary measures, when sustained and coordinated, not only mitigate hysteresis effects but can also shift unemployment away from the so-called natural level, reaffirming the Keynesian insight that active policy can shape real economic outcomes even in the presence of structural frictions. This study contributes both theoretically to macroeconomic stabilization debates and practically to policy design in economies facing recurrent shocks and structural vulnerabilities. |
| Keywords: | Keynesian macroeconomics, natural rate hypothesis, unemployment dynamics, income stabilization, Sri Lanka. |
| JEL: | E24 E32 E62 O53 |
| Date: | 2025–09–01 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126758 |
| By: | Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Socio-Ecological Transformation Lab, Johannes Kepler University Linz, Austria); Lukas Baeuerle (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Socio-Ecological Transformation Lab, Johannes Kepler University Linz, Austria) |
| Abstract: | The paper introduces the SETER framework, a conceptual tool for analyzing the interplay between Socio-Ecological Transformation (SET) and Economic Reasoning (ER). In the context of global crises and the contested nature of sustainability discourses, the framework identifies nine key categories – ranging from economic goals and the role of the state to transformative dynamics and agency – to systematically compare diverse SET narratives and their basic underlying economic assumptions. Drawing on insights from Social Studies of Economics (SSE) and Sustainability Transitions Research (STR), the framework highlights how ER shapes SET discourses and potential pathways, influencing both the diagnosis of socio-ecological crises and its proposed solutions. The paper applies the framework for two contrasting cases: the EU Green Deal, which exemplifies a market-driven “green growth” narrative, and Kohei Saito’s Degrowth Manifesto, which advocates for commons-based, sufficiency-oriented transformation. These cases illustrate the framework’s ability to map competing visions of SET, revealing the systemic dependencies between ER categories and their manifestations. The SETER framework also enables a typification of antagonistic narratives opposing SET, such as techno-libertarian or fossil-modernization discourses. While the framework provides a useful tool for categorizing and comparing SET narratives, its integration with power-focused analytical tools is necessary to assess the performative influence of these narratives. By offering a flexible, cross-sectoral, and longitudinal approach, the SETER framework provides a robust methodology for navigating the complexities of SET-related discourses, fostering critical reflection on economic imaginaries, and envisioning equitable and sustainable pathways for transformation. |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:ico:wpaper:171 |
| By: | Precious A. Brenni |
| Abstract: | The rapid advancement of technology, including generative AI, presents new challenges to active student involvement in the learning process. This study investigates whether playful learning, using LEGO® as a tool, enhances student engagement in Real Estate Finance, an undergraduate module at Durham University. Data comes from an anonymous student survey, following the completion of the workshop-based playful learning activities. Initial findings indicate that playful learning is a fun but not frivolous pedagogic approach, fostering individual involvement and active collaboration. The results also show no significant differences in satisfaction levels across gender and student status, highlighting the potential of playful learning to create more inclusive study spaces. Further, the findings suggest that playful learning and generative AI can be effectively combined to align with the fast-evolving educational landscape. Overall, this study hints at the need to go beyond conventional teaching methods and adopt approaches that support more engaging and inclusive learning experiences in (real estate) education. |
| Keywords: | Engagement; Learn; LEGO®; Play |
| JEL: | R3 |
| Date: | 2025–01–01 |
| URL: | https://d.repec.org/n?u=RePEc:arz:wpaper:eres2025_205 |
| By: | López-Espejo, Iván |
| Abstract: | This article examines the law of the tendency of the rate of profit to fall in the Spanish economy between 1960 and 2024, considering the organic composition of capital and the rate of surplus value as central variables. Its aim is to determine whether this law, formulated by Marx in Capital (Vol. III), continues to operate in the contemporary context. The methodology consists of transforming orthodox macroeconomic categories derived from the Spanish National Accounts (CNE), available in BDMACRO, into Marxist variables: constant capital (c), variable capital (v), and surplus value (pv). Based on these, historical series of the organic composition of capital (q), the rate of surplus value (pv'), and the rate of profit (g') are constructed, adjusted to constant prices to ensure temporal coherence and comparability. The results show a sustained increase in q and a slight decrease in pv', generating a tendential decline in g' with cyclical fluctuations associated with specific crises. The conclusions empirically confirm the validity of the law in Spain, highlighting the historical limits of capitalism and providing quantitative evidence on the structural dynamics of profitability. |
| Keywords: | Tendency of the rate of profit; organic composition of capital; rate of surplus value; Spanish economy; economic cycles |
| JEL: | B51 C93 O11 O47 P16 |
| Date: | 2025–09–08 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127016 |