Autonomous government expenditure growth, deficits, debt and distribution in a neo-Kaleckian growth model
No 2016-02, Working Papers from Universita' di Cassino, Dipartimento di Economia e Giurisprudenza
This paper is linked to some recent attempts at including a non-capacity creating autonomous expenditure category as the driver and determinant of growth into Kaleckian distribution and growth models. Whereas previous contributions have focussed on taming Harrodian instability, generated by the deviation of the goods market equilibrium rate of capacity utilisation from a normal or target rate of utilisation, we rather focus on the so far neglected issues of deficit, debt and distribution dynamics in such models. For this purpose we treat the growth of government expenditures on goods and services, financed by credit creation, as the exogenous growth rate driving the system. We examine the medium-run convergence of the system towards such a growth rate, analyse the related long-run debt dynamics and deal with stability and income distribution issues. Finally we touch upon the economic and, in particular, fiscal policy implications of our model results.
JEL-codes: E11 E12 E25 E62 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-fdg, nep-mac and nep-pke
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Journal Article: Autonomous government expenditure growth, deficits, debt, and distribution in a neo-Kaleckian growth model (2018)
Working Paper: Autonomous government expenditure growth, deficits, debt and distribution in a neo-Kaleckian growth model (2016)
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