Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/209150
Authors: 
Nikiforos, Michalis
Year of Publication: 
2018
Series/Report no.: 
Working Paper No. 907
Abstract: 
The paper discusses the Sraffian supermultiplier (SSM) approach to growth and distribution. It makes five points. First, in the short run the role of autonomous expenditure can be appreciated within a standard post-Keynesian framework (Kaleckian, Kaldorian, Robinsonian, etc.). Second, and related to the first, the SSM model is a model of the long run and has to be evaluated as such. Third, in the long run, one way that capacity adjusts to demand is through an endogenous adjustment of the rate of utilization. Fourth, the SSM model is a peculiar way to reach what Garegnani called the "Second Keynesian Position". Although it respects the letter of the "Keynesian hypothesis", it makes investment quasi-endogenous and subjects it to the growth of autonomous expenditure. Fifth, in the long run it is unlikely that "autonomous expenditure" is really autonomous. From a stock-flow consistent point of view, this implies unrealistic adjustments after periods of changes in stock-flow ratios. Moreover, if we were to take this kind of adjustment at face value, there would be no space for Minskyan financial cycles. This also creates serious problems for the empirical validation of the model.
Subjects: 
Sraffian Supermultiplier
Long Run
Utilization
Autonomous Demand
JEL: 
B22
B5
E12
E32
O4
Document Type: 
Working Paper

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