Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/79491
Authors: 
Nikiforos, Michalis
Year of Publication: 
2012
Series/Report no.: 
Working Paper, Levy Economics Institute 739
Abstract: 
This paper examines the utilization controversy around the Kaleckian model of growth and distribution. We show that the Federal Reserve data on capacity utilization, which have been used by both sides of this debate, are the wrong kind of data for the issue under examination. Instead, a more appropriate measurement can be derived from the data on the Average Workweek of Capital. We argue that the long-run dynamic adjustment proposed by Kaleckian scholars lacks a coherent economic rationale, and provide an alternative path toward the endogeneity of the desired utilization at the micro and macro levels. Finally, we examine the proposed adjustment mechanism econometrically. Our results verify the endogeneity of the normal utilization rate.
Subjects: 
Kaleckian
long run
economies of scale
utilization
JEL: 
B50
E12
E22
Document Type: 
Working Paper

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