Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/145410
Authors: 
Razmi, Arslan
Year of Publication: 
2015
Series/Report no.: 
Working Paper, University of Massachusetts, Department of Economics 2015-01
Abstract: 
Neo-Kaleckian literature has actively debated whether growth is wage- or profit-led in capitalist economies. However, existing studies tend to ignore the non-tradable sector and heterogeneity within the tradable sector. This paper shows that incorporating these features renders wage-led growth in an open developing economy unfeasible in the traditional (Kaleckian) sense of the term. This result - which follows even if one sets aside the competitiveness considerations generally seen as impeding such growth - occurs due to the presence of a homogeneous goods-producing tradable sector that sets the ceiling to steady state growth. A corollary, in light of findings from the "new new trade theory" literature, is that increasing South-South trade may tend to narrow room for wage-led growth regardless of the other desirable effects of higher wages.
Subjects: 
Wage-led growth
non-tradables
neo-Kaleckian models
development
output heterogeneity
JEL: 
F43
F66
O41
F63
E12
Document Type: 
Working Paper

Files in This Item:
File
Size





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