EconPapers    
Economics at your fingertips  
 

Long run convergence in a neo-Kaleckian open-economy model with autonomous export growth

Won Jun Nah and Marc Lavoie

No PKWP1604, Working Papers from Post Keynesian Economics Society (PKES)

Abstract: A simple neo-Kaleckian open-economy model is presented and its implications for growth regimes are analyzed. The present model features long run-convergence to its normal rate of capacity utilization, which is conditionally achieved by incorporating the Harrodian principle of instability and autonomous growth in foreign demand. It is demonstrated that some aspects of the main Kaleckian results can be preserved not only in the short run but also in the long run, in the sense that both (i) a decrease in the propensity to save, and (ii) a change in income distribution favoring labor, bring about higher average rates of production growth and capital accumulation. However, the long-run impact of a change in the profit share is shown to be subjected to the condition that the responsiveness of the real exchange rate with respect to the profit share has to be bounded from above, confirming that the scope for wage-led demand or wage-led growth can be limited by open-economy considerations.

Keywords: neo-Kaleckian; growth; capacity utilization; exports; profit share; real exchange rate (search for similar items in EconPapers)
JEL-codes: E11 F41 O41 (search for similar items in EconPapers)
Pages: 30
Date: 2016-02
New Economics Papers: this item is included in nep-gro, nep-mac and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.postkeynesian.net/downloads/working-papers/PKWP1604_Y57A0kM.pdf First version, 2016 (application/pdf)

Related works:
Journal Article: Long-run convergence in a neo-Kaleckian open-economy model with autonomous export growth (2017) Downloads
Working Paper: Long-run convergence in a neo-Kaleckian open-economy model with autonomous export growth (2017)
Working Paper: Long-run convergence in a neo-Kaleckian open-economy model with autonomous export growth (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pke:wpaper:pkwp1604

Access Statistics for this paper

More papers in Working Papers from Post Keynesian Economics Society (PKES) Contact information at EDIRC.
Bibliographic data for series maintained by Jo Michell (jo.michell@uwe.ac.uk).

 
Page updated 2024-11-07
Handle: RePEc:pke:wpaper:pkwp1604