European Economies in Light of the Keynesian cum Kaldorian Macroeconomic Distribution Theory: A Theoretical and Empirical Investigation

Michael ?llinger () and Friedrich L. Sell ()
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Michael ?llinger: Universit?t der Bundeswehr M¨¹nchen / Bundeswehr University Munich Institut f¨¹r Controlling, Finanz- und Risikomanagement, Germany
Friedrich L. Sell: Universit?t der Bundeswehr M¨¹nchen / Bundeswehr University Munich Institut f¨¹r ?konomie und Recht der globalen Wirtschaft, Germany

Review of Economics & Finance, 2019, vol. 16, 59-75

Abstract: In this paper, we present a combination of Keynesian and Kaldorian macroeconomic distribution theory. After a short literature review, we proceed to assessing the actual relevance of the original contributions of Keynes and Kaldor to the theory of macroeconomic income distribution. Thereafter, we put a combination of both approaches under an empirical test. An important outcome of our theoretical research is that the (total) savings ratio is an endogenous variable which is itself (among other factors which determine its equilibrium value) a positive function of the profit quota. In the empirical section of the paper, we first present the development of the saving quotas, of the profit quotas and of the total tax quotas among 8 European countries between 1999 and 2014. This time- period covers both phases of moderation (1999-2007) and of great economic crisis (2008-2014) in Europe. Furthermore, we conduct a linear regression analysis for the countries mentioned and find empirical support for a savings function in the vein of Nicholas Kaldor and of John Maynard Keynes.

Keywords: Keynesian and Kaldorian Approaches to income distribution; Income distribution in European economies; Empirical estimates of savings function (search for similar items in EconPapers)
JEL-codes: D30 D33 D63 (search for similar items in EconPapers)
Date: 2019
Note: The authors dedicate this paper to Gerold Bl¨¹mle, Alois Oberhauser und Bernhard K¨¹lp. The authors presented it for the first time at the 83rd IAES conference (London: 14-17 March, 2018). We thank Reinhard Neck, Thomas Gries, Helena Sanz-Morales, and other participants of the session on ¡°Macroeconomic Theory and Policy II¡± for their helpful comments. We also thank anonymous referees for inspired suggestions.
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