Financialization in Kaleckian Economies with and without Labor Constraints

Soon Ryoo and Peter Skott

European Journal of Economics and Economic Policies: Intervention, 2008, vol. 5, issue 2, 357-386

Abstract: Most Kaleckian models assume a perfectly elastic labor supply, an assumption that is questionable for many developed economies. This paper presents simple labor-constrained Kaleckian models and uses these models to compare the implications of financialization under labor-constrained and dual-economy conditions. The paper complements the analysis in Skott and Ryoo (2008) which did not include labor-constrained Kaleckian economies. We show that for plausible parameter values the financial changes commonly associated with financialization tend to be expansionary in both dual-economy and labor-constrained settings.

Keywords: financialization; stock-flow consistency; labor constraints; Kaleckian model (search for similar items in EconPapers)
JEL-codes: E12 E44 (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (29)

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Working Paper: Financialization in Kaleckian economies with and without labor constraints (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:elg:ejeepi:v:5:y:2008:i:2:p:357-386

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