An Evaluation of neo-Kaleckian supermultiplier and neo-Goodwinian models

Brett Fiebinger

No 78-2022, FMM Working Paper from IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute

Abstract: This paper provides a theoretical and empirical evaluation of neo-Kaleckian supermultiplier and neo-Goodwinian models. The benchmark structuralist and Harrodian neo-Goodwinian models posit a macro economy with only one asset: the capital stock. Demand leakages presuppose that at least one sector is able to realise an excess of revenues over expenditures as a positive accumulation of net financial assets vis-Ã -vis other sectors. Models with a single real asset - and which assume each sector always has nil net lending/borrowing - provide pseudo explanations of real world economic activity. We show that neo-Kaleckian supermultiplier models with overhead labour can account for the induced nature of capacity investment, a pro-cyclical profit share and stylised net lending/borrowing patterns.

Keywords: Pseudo-Goodwin cycles; External markets; Net lending/borrowing; Overhead labour (search for similar items in EconPapers)
JEL-codes: B22 B50 E11 E20 E30 O40 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:imk:fmmpap:78-2022

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