Capital Theory Debates: New Developments and Direction

Lefteris Tsoulfidis ()

No CSWP51, Centro Sraffa Working Papers from Centro di Ricerche e Documentazione "Piero Sraffa"

Abstract: In recent years, the research on capital theory has shifted from reverse capital deepening and reswitching in techniques to a new direction, which goes beyond the near-linearities of price-rates of profit trajectories and wage-rates of profit curves and explicates the reasons behind them. The reswitching issue remains in the background of these studies as a remote, albeit ever-present, possibility. The article contributes some more evidence to the extant literature by utilizing data from the last available benchmark input-output table of the US economy of the year 2012. The derived near-linearities of price trajectories and wage-rate of profit curves are explained by the low effective rank of the economy’s input-output matrices and not from their seemingly random character. These findings shed additional light on a new and more meaningful direction in the research agenda; that is, the possibility of molding the essential features of the economy through dimensionality reduction.

Keywords: price rate of profit trajectories; capital controversies; effective rank; eigendecomposition; eigenvalues (search for similar items in EconPapers)
JEL-codes: B24 B51 C67 D46 D57 E11 E32 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2021-09-22
New Economics Papers: this item is included in nep-cwa, nep-hme, nep-hpe and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:sraffa:0051

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