{"title":"Abductive analogies between Keynes’ monetary-production economics and Einstein’s theories of relativity","authors":"J. Pedersen","doi":"10.1080/01603477.2022.2101125","DOIUrl":"https://doi.org/10.1080/01603477.2022.2101125","url":null,"abstract":"Abstract In this paper, it is argued that there exist different interdisciplinary abductive analogies between Keynes’ monetary-production theory and Einstein’s theories of relativity. Based on some of the equations in Einstein’s special theory of relativity vis-à-vis the fundamental equation describing the equilibrium condition in Keynes’ model version of a realistic entrepreneur economy—a complementary scheme to an algebraic-topological interpretation of Keynes’ vision is outlined within the Post Keynesian scientific research programme.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-07-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44552099","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Offshoring via vertical FDI in a long-run Kaleckian Model","authors":"R. Woodgate","doi":"10.1080/01603477.2022.2090378","DOIUrl":"https://doi.org/10.1080/01603477.2022.2090378","url":null,"abstract":"Abstract This paper develops a two-country Kaleckian model in which “Northern” firms invest a fixed fraction of total investment in foreign affiliates in the low-wage “South” in order to offshore the production of intermediate goods over time. On the back of this setup follows an analysis of the macroeconomic implications of offshoring in the short and long run. Offshoring through vertical FDI is found to lead to a falling wage share and a simultaneously falling price level and rising markup in the North, whereas the effect on equilibrium capacity utilization may be positive or negative. Regardless of the effect on capacity utilization and firm profitability, we can show that the structural change implied by offshoring leads to lower rates of capital accumulation and employment in the North in the short run. The long-run effects on Northern employment and growth, on the other hand, depend crucially on the long-run accumulation rate of the Northern-owned multinational firms and on whether wages in the North and the South endogenously converge. The model appears well suited to shed light on many real-world macroeconomic phenomena, such as rising FDI flows, falling wage shares, rising markups in an era of low inflation, hysteresis, and secular stagnation.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-07-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46477282","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"More fiscally responsible: Democrat or Republican presidents?","authors":"Peter N. Hess","doi":"10.1080/01603477.2022.2094276","DOIUrl":"https://doi.org/10.1080/01603477.2022.2094276","url":null,"abstract":"Abstract Evidence is reviewed that national economic performance generally has been better under Democrat presidents. It is likely, but not necessarily true, however, that better economic performance is related to greater fiscal responsibility. A brief history of federal budget deficits and the gross federal debt for the last seven decades is followed by discussion of why federal budget deficits matter. A simple model is estimated where the shares of federal budget deficits in gross domestic products over the 72-year period from 1950 to 2021 are regressed on the civilian unemployment rate, indicating the state of the economy, and controlling for whether a Democrat or Republican is president and for years the U.S. was engaged in war. An Index of Fiscal Discipline is then regressed on the growth rate in real gross domestic product, again controlling for the party in the White House and war years. The results show that Democrat presidents have been significantly more fiscally responsible.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46932963","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Climate change and macroeconomic policy space in developing and emerging economies","authors":"Anne Löscher, Annina Kaltenbrunner","doi":"10.1080/01603477.2022.2084630","DOIUrl":"https://doi.org/10.1080/01603477.2022.2084630","url":null,"abstract":"Abstract This paper addresses the macroeconomic challenges stemming from the double affectedness of climate change and dependence on external finance in peripheral countries. The paper uses the Post-Keynesian concept of an asset’s own rate of return to assess how susceptibility to the combined effects of erratic capital flows and the vulnerability vis-à-vis the physical and transitional risks of climate change reduces macroeconomic policy space. Climate change and mitigation strategies are said to contribute to financial instability ensuing flight-to-quality of international investors. This translates into higher external financial fragility in low income countries with a high degree of commodity dependence—with increased exchange rate volatility and devaluating pressure deteriorating affected countries’ currencies’ liquidity premia and the expectation of their short-term exchange rates as result. Consequently, policy-makers in affected countries are forced to commit to investor-friendly policies and high interest rates to uphold their currencies’ acceptance. The susceptibility to the physical risks of climate change and mitigation hence contributes to the self-perpetuating nature of international monetary asymmetries and hierarchies.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-06-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42410003","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The global financial cycle and external debt: effects on growth and distribution in emerging and developing economies","authors":"P. Bortz, Gabriel Michelena, Fernando Toledo","doi":"10.1080/01603477.2022.2068032","DOIUrl":"https://doi.org/10.1080/01603477.2022.2068032","url":null,"abstract":"Abstract The global financial cycle (GFCy), driven by international monetary conditions and global risk perceptions, is a major driver of capital flows to and out of emerging and developing economies (EDEs), reflected in external indebtedness. This paper analyzes the impact of the GFCy on the economic performance of EDEs borrowing in international markets. Rising external borrowing generates appreciating pressures on the exchange rate and lowers the cost of external borrowing. The overall impact of these reinforcing effects acts over investment, debt servicing and the current account balance. We conduct simulation exercises which show that rising external debt coupled with lax external financial conditions have a detrimental impact on economic activity and creates inflationary pressures through the effect of financial costs and the reaction of nominal wage demands. We show that capital control measures increase the degrees of freedom of monetary authorities.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-06-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48669721","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Lost in consolidation? Declining public investment, multiplier effects and alternatives to the path of fiscal consolidation in Portugal","authors":"Vicente Ferreira","doi":"10.1080/01603477.2022.2077764","DOIUrl":"https://doi.org/10.1080/01603477.2022.2077764","url":null,"abstract":"Abstract This paper deals with one of the most pressing concerns that Eurozone periphery economies will face in the near future: how to achieve a sustained recovery from the COVID-19 crisis while dealing with growing public debt-to-GDP ratios. The paper assesses the macroeconomic relationship between public spending, economic growth and debt sustainability. We use a TSLS method to perform the econometric estimation of the public spending multiplier for a panel of 11 Eurozone economies over the 1995–2019 period. We find evidence that the multiplier is positive and close to 1,8, suggesting that the benefits of promoting public investment exceed its initial financing cost. As a result, we conclude that debt sustainability is not only compatible with, but in fact improved by a more expansive fiscal policy and present an alternative policy path for the Portuguese economy in the 2021–2025 period based on this conclusion.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-06-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46232832","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Link between private debt and public surplus in Spain","authors":"Eduardo Garzón Espinosa, Bibiana Medialdea García, Esteban Cruz Hidalgo, Carlos Sánchez Mato","doi":"10.1080/01603477.2022.2068035","DOIUrl":"https://doi.org/10.1080/01603477.2022.2068035","url":null,"abstract":"Abstract Throughout recent history, the Spanish economy registered a fiscal surplus only between 2005 and 2007. Analysts agree that this surplus was a product of the extraordinary economic growth, but they often fail to notice that it was based on similarly exceptional growth in private debt, which was a necessary condition for achieving fiscal surplus. This finding can be illuminated from the vantage of sectoral balances: in economies that usually run a current account deficit, such as Spain’s, a public surplus can be achieved only in situations characterized by a credit bubble. To verify this idea we examine the impact that the Spanish real estate and credit bubble had on public accounts, and we also estimate an econometric model of autoregressive vectors. The results corroborate the working hypothesis: Spain’s only fiscal surplus in recent years was achieved thanks to the largest private indebtedness process in the country’s history. This evidence could have important implications in terms of economic policy, because economies with regular current account deficits such as Spain could have difficulties in achieving their fiscal goals without experiencing credit booms.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-05-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43832825","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Estimation of a long run regime for growth and demand through different filtering methods","authors":"Joana David Avritzer","doi":"10.1080/01603477.2022.2068033","DOIUrl":"https://doi.org/10.1080/01603477.2022.2068033","url":null,"abstract":"Abstract This paper discusses the possibility of estimating a long run relationship between income distribution and growth. As emphasized by Blecker, the neo-Kaleckian empirical literature has focused on the estimation of a short run relationship. This paper contributes to the debate by looking at a long term relationship through the use of filtering methods. We first estimate the long run component (or “trend” component) of the relevant variables using various types of filters. Second, we run causality tests and frequentist estimations to test for the relationship between the estimated trend components. We find that there is little difference between the results of each filter and there is empirical evidence for long run relationship between the rate of capacity utilization and income distribution. We also find that there is some empirical evidence for long run wage-led growth.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-05-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45922047","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Carles Manera, F. Navinés, José A. Pérez-Montiel, Javier Franconetti
{"title":"Capital productivity and the decreasing wage share in the United States: a Keynesian Approach","authors":"Carles Manera, F. Navinés, José A. Pérez-Montiel, Javier Franconetti","doi":"10.1080/01603477.2022.2068034","DOIUrl":"https://doi.org/10.1080/01603477.2022.2068034","url":null,"abstract":"Abstract We argue that in the US there is a causal relationship running unidirectionally from negative shocks in capital productivity to negative variations in the wage share. We sustain that, faced with a capital productivity decrease, the US firm sector pushes wages down to maximize the rate of profit. Through asymmetric SVAR techniques that are robust to endogeneity and structural breaks; we show that decreases in capital productivity unidirectionally cause decreases in the wage share. We offer some possible explanations for that.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-05-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47087969","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Remembering Geoff Harcourt (1931–2021): a post-Keynesian pioneer","authors":"S. Cornish, John Hawkins","doi":"10.1080/01603477.2022.2068036","DOIUrl":"https://doi.org/10.1080/01603477.2022.2068036","url":null,"abstract":"Abstract Geoff Harcourt was esteemed for the quality of his prolific scholarship. He was a pioneering post-Keynesian economist who specialized in capital theory. But he also wrote on many other theoretical areas as well as contributing to policy debates and writing intellectual biographies. In addition to his published work, he made a remarkable contribution as a teacher and mentor, encouraging, supporting and guiding countless students and colleagues. His contributions to economics and public policy are therefore far more than the work he wrote himself. Generous, collegiate, encouraging and sympathetic, he was an outstanding person as well as a great economist.","PeriodicalId":47197,"journal":{"name":"Journal of Post Keynesian Economics","volume":null,"pages":null},"PeriodicalIF":1.0,"publicationDate":"2022-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42015317","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}