Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/105932
Authors: 
Palley, Thomas I.
Year of Publication: 
2010
Series/Report no.: 
IMK Working Paper 7/2010
Abstract: 
This paper develops a neo-Kaleckian endogenous growth model that incorporates aggregate supply - demand balance and balance between labor force and employment growth. The paper explicitly models income distribution which is a critical channel whereby unemployment affects investment and growth. The model generates a growth unemployment rate trade-off. A reduced propensity to save raises growth but it also raises the unemployment rate because of induced technological progress. This resonates with Alvin Hansen's hypothesis. The paper contains several theoretical innovations including a new mechanism whereby unemployment affects income distribution; introduction of a Phillips curve and inflation effects; and introduction of demand growth expectation effects.
Subjects: 
aggregate demand
supply
unemployment
neo-Kaleckian endogenous growth theory
JEL: 
E12
O41
O33
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.