Normal Paths of Growth Shaped by the Supermultiplier

Óscar Dejuán

Chapter 6 in Sraffa and the Reconstruction of Economic Theory: Volume Two, 2013, pp 139-157 from Palgrave Macmillan

Abstract: Abstract The Keynesian principle of effective demand states that the equilibrium level of output in a given period is a multiple of the expected autonomous demand (Kalecki, 1971; Keynes, 1936). Can we extrapolate this principle to a long-run dynamic analysis and conclude that the rate of growth of output will eventually depend on the expected rate of growth of autonomous demand? A positive answer would be a significant step towards a long-period theory of output which, according to Eatwell and Milgate, provides the most solid ground for demand-led growth (Milgate, 1982; Eatwell, 1983; Eatwell and Milgate, 1983; Eatwell, 2012).

Keywords: Aggregate Demand; Capacity Utilisation; Mortgage Loan; Normal Capacity; Productive Investment (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-31916-6_7

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DOI: 10.1057/9781137319166_7

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