Demand and growth regimes in finance-dominated capitalism and a progressive equality-, sustainability- and domestic demand-led alternative

• Published in: PSL quarterly review Vol. 76; no. 305
• Main Authors: Eckhard Hein, Franz Prante, Alessandro Bramucci
• Format: Journal Article
• Language: English
• Published: Associazione Economia civile 01-09-2023
• Subjects: debt; financialisation; growth regimes; inequality; post-Keynesian macroeconomics; social capitalism
• ISSN: 2037-3635; 2037-3643
• DOI: 10.13133/2037-3643/18211

Making use of a post-Keynesian/Kaleckian two-country stock-flow consistent (SFC) simulation model, we shed light on different regimes in modern finance-dominated capitalism, their interaction at the global scale, and then on the changes in regimes after the 2007-09 crises. Most importantly, we present the main features of a progressive and more stable equality-, sustainability- and domestic demand-led regime. We show that the main features of such a regime will have to focus on a ‘reformed capitalism’ with regulated finance, a more equal distribution of income and active government fiscal policies, as guide posts for progressive social democracy.