Some instability puzzles in Kaleckian models of growth and distribution: a critical survey

We tackle the issue of the possible instability of the Kaleckian distribution and growth model. Distinguishing between Keynesian and Harrodian instability, we review various mechanisms that have been proposed by critics of the Kaleckian model to tame Harrodian instability while bringing back the rat...

Full description

Saved in:

Bibliographic Details
Published in:	Cambridge journal of economics Vol. 35; no. 3; pp. 587 - 612
Main Authors:	Hein, Eckhard, Lavoie, Marc, van Treeck, Till
Format:	Journal Article
Language:	English
Published:	Oxford OXFORD UNIVERSITY PRESS 01-05-2011 Oxford Publishing Limited (England)
Subjects:	Capacity utilization Distribution Economic growth Economic growth models Economic growth rate Economic instability Economic investment Economic modeling Economic models Economic theory Equilibrium models Financial investments Growth models Keynesian theory Keynesianism Paradoxes Sales growth Studies
Online Access:	Get full text
Tags:	Add Tag No Tags, Be the first to tag this record!

Description
Summary:	We tackle the issue of the possible instability of the Kaleckian distribution and growth model. Distinguishing between Keynesian and Harrodian instability, we review various mechanisms that have been proposed by critics of the Kaleckian model to tame Harrodian instability while bringing back the rate of utilisation to its normal rate. We find that the mechanisms that have been suggested are far from convincing. Therefore, we conclude that it may be premature for the critics of the Kaleckian model to dismiss the endogeneity of the rate of capacity utilisation in long-run growth equilibrium.
Bibliography:	ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 23
ISSN:	0309-166X 1464-3545
DOI:	10.1093/cje/beq026