The macrodynamics of an endogenous business cycle model of marxist inspiration

John Cajas Guijarro and Leonardo Vera

Structural Change and Economic Dynamics, 2022, vol. 62, issue C, 566-585

Abstract: This study offers a model that formalizes some of Marx's insights about how capital accumulation generates contradictions that may reproduce never-ending cycles of booms and slumps. The model takes the reserve army of labor as a regulator of the distribution of class-power over the business cycle with a two-sided role: influencing labor productivity, directly through the intensity of labor and indirectly through real wages. The model forms a complex dynamical system capable to yield trajectories for the employment rate, the wage share, and the intensity of labor. Goodwin (1967) model may be considered as a particular case of the model. Complex dynamics may also emerge when we remove some key assumptions and explore and simulate 3-D versions of the system. Though close orbits around non-hyperbolic equilibrium points can be obtained, the possibility of unstable dynamics with increasing amplitudes in the trade cycle and a structural crisis cannot be ruled out.

Keywords: Business cycle; Capital accumulation; Reserve army of labor, Labor intensity (search for similar items in EconPapers)
JEL-codes: C63 E11 O41 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:62:y:2022:i:c:p:566-585

DOI: 10.1016/j.strueco.2022.08.002

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