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Increased Shareholder Power, Income Distribution, and Employment in a Neo-Kaleckian Model with Conflict Inflation

Hiroaki Sasaki ()

Discussion papers from Graduate School of Economics , Kyoto University

Abstract: By using a Kaleckian model with firms’ debt accumulation, we investigate how in- creased shareholder power defined by a decrease in firms’ retention ratio and a mone- tary policy defined by interest controlled by a central bank a?ect macroeconomic vari- ables. The long-run equilibrium can be stable even if the short-run equilibrium exhibits debt-burdened growth. In addition, the long-run equilibrium can be unstable even if the short run equilibrium exhibits debt-led growth. Increased shareholder power can increase both rentiers and workers’ income shares. A monetary easing policy has an expansionary e?ect on the economy. However, it decreases both workers and rentiers’ income shares and thus has a negative e?ect on income distribution.

Keywords: financialization; income distribution; employment; firms’ debt (search for similar items in EconPapers)
JEL-codes: E12 E21 E22 E32 E44 (search for similar items in EconPapers)
Date: 2016-10
New Economics Papers: this item is included in nep-mac and nep-pke
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