No positive economic doctrine has been able until now to escape from the trap of being valid only... more No positive economic doctrine has been able until now to escape from the trap of being valid only under very specific conditions, so special as not to be replicated even minimally in actual historical experience. Consider the two fundamental approaches of the 19th century: the Marxian and the Neoclassical one. They both attempt to tell a story about the long-term behaviour of the system. The former tries to identify objective laws of motion, the latter some kind of immanent behaviour to be taken as a normative reference for a real system. They both fail encountering similar analytical problems. In particular, the long-term validity of both approaches depends heavily on the homogeneous nature of the economy they depict.1 Marx’s long-term theory of capitalist accumulation is not free from the scourge of homogeneity either (see Appendix). Indeed I believe that there are in Marx two distinct and non-compatible macroeconomic theories. The first, of a Ricardian nature, is to be found in Volume One of Capital and culminates in the well known chapter (25) on the Reserve Army of Labour. Its essential elements are reproduced in Wage Price and Profit, a fact that has some importance. Wage Price and Profit is Marx’s speech at the founding meeting of the First International. It can, therefore, be viewed as expressing his core thoughts when economic statements had to be stripped down to their essential points. The second approach is contained in Volume Two of Capital, largely put together by Engels, which gave rise to the most far reaching set of economic debates within the Second International.
The work of Adolph Lowe can be considered as a milestone in the construction of a theoretical fra... more The work of Adolph Lowe can be considered as a milestone in the construction of a theoretical framework in which the stability of full employment as well as its attainment become inseparable from the ex-ante planning of sectoral proportions. At the same time, the ex-post planning of the adjustment path is required whenever the initial quantitative assumptions turn out to be incorrect.1 The remarkable characteristic of Lowe’s approach consists in the fact that it permits formulating an argument for planning under conditions of economic maturity. This point is rather important because most works on planning have, so to speak, subsumed the historical fact that socialist planned economies grew out of a social transformation of hitherto “backward” societies. As a result, the emphasis was mainly laid on questions of capital formation in the sense of the mobilization of the existing economic structure in order to produce an altogether different one in a relatively short span of time. The dynamics of sectoral proportions has been analyzed mostly in terms of the speed in which the new structure can be built in a context where the “backward” sector is identified with an unlimited supply of labor.2 Hence, because of the historical link between planned economies and the emancipation from backwardness, intersectoral (Marxian) type models have been produced with the aim of studying issues concerning the possibilities of, and the obstacles to, accelerated accumulation.
DOAJ (DOAJ: Directory of Open Access Journals), Dec 1, 2013
Il lavoro si occupa dei colli di bottiglia che possono sorgere nel processo di sviluppo economico... more Il lavoro si occupa dei colli di bottiglia che possono sorgere nel processo di sviluppo economico in un'economia capitalistica . L' autore mette a confronto il modello trisectoral di Adolph Lowe con l'analisi di John Hicks ' della traversata . Egli conclude che , in condizioni compatibili con la piena occupazione , il modello di Hick implica un certo grado di determinismo che il trattamento di Lowe , e in grado di evitare . The work deals with the bottlenecks that may arise in the process of economic development in a capitalist economy. The author compares Adolph Lowe’s trisectoral model with John Hicks’ analysis of the traverse. He concludes that by looking at the conditions compatible with full employment, Hick’s model implies a degree of determinism that Lowe’s treatment, by allowing for the formation of unused capacity and unemployment, is able to avoid. JEL: E22, E24
This chapter discusses the Kaldorian and Post-Keynesian approaches to inflation. The main thrust ... more This chapter discusses the Kaldorian and Post-Keynesian approaches to inflation. The main thrust of the chapter is a critique of the notion of a fixed markup. Through the use of a two sector capital goods-consumption goods model with sectoral degrees of capacity utilisation, it is shown that the markup itself varies according to changes in the sectoral structure of the economy, including nonuniform changes in the sectoral rates of utilisation. It is suggested that viewing inflation as stemming from money wage increases relatively to productivity is not as robust as it might appear in some of the Post-Keynesian literature.
This work argues that the dominance of supply-side considerations in the macroeconomic policy deb... more This work argues that the dominance of supply-side considerations in the macroeconomic policy debate has led towards depression at a world level, particularly in transitional and developing economies. The book suggests that it is necessary to rehabilitate the role of effective demand.
This chapter argues that Hicks’s Capital and Growth, and its rewritten version Methods of Dynamic... more This chapter argues that Hicks’s Capital and Growth, and its rewritten version Methods of Dynamic Economics, constitute a critique of both Neo-classical and Classical economics. The critique of the Neo-classical side is explicit: it appears in the series of explanations concerning the necessity to abandon the Temporary Equilibrium method of Value and Capital. Furthermore, the way in which Hicks argues against the assumption of a given aggregate saving ratio takes him straight into the Kaldor-Pasinetti Cambridge Equation. Having jettisoned both the Temporary Equilibrium and the Harrod type Fixprice methods, Hicks ends up with Sraffa type prices of production. By inserting those prices into the saving equation he obtains a model where any change in the natural growth rate implies a change in the distribution of income a la Kaldor with the underlying prices being determined a la Sraffa.
This chapter will discuss Adolph Lowe’s (1955, 1976) contributions by positioning them in relatio... more This chapter will discuss Adolph Lowe’s (1955, 1976) contributions by positioning them in relation to the accumulation and crisis debate developed by Russian and German Marxism at the turn of the century (Section 2), to the question of the traverse in a mature economy (Section 3), and to the quasi-structural theories of development of Maurice Dobb and of the Indian school of planning (Section 4).
The work takes up some issues raised by Kalecki in his posthumously published article “Class stru... more The work takes up some issues raised by Kalecki in his posthumously published article “Class struggle and distribution of national income”. By using Marx’s schemes of reproduction, Kalecki was able to prove that, in a given short period, a part of the wage bill is positively related to the level of profits in the consumption goods sector and through the latter, to the level of aggregate profits. Following Kalecki’s methodology of a two sector Marxian model, the author introduces inventories into the framework. In order to do so critical analysis of the supply functions postulated in most of his earlier works on oligopolistic pricing is provided. It is then demonstrated how even under the most favourable short-run technological conditions, bottlenecks may arise depending on the price/cost relation and on the level of inventories in the way described by Hicks. Finally, capital accumulation is introduced into the framework and it is argued that longer run inventories play a much reduced role.
No positive economic doctrine has been able until now to escape from the trap of being valid only... more No positive economic doctrine has been able until now to escape from the trap of being valid only under very specific conditions, so special as not to be replicated even minimally in actual historical experience. Consider the two fundamental approaches of the 19th century: the Marxian and the Neoclassical one. They both attempt to tell a story about the long-term behaviour of the system. The former tries to identify objective laws of motion, the latter some kind of immanent behaviour to be taken as a normative reference for a real system. They both fail encountering similar analytical problems. In particular, the long-term validity of both approaches depends heavily on the homogeneous nature of the economy they depict.1 Marx’s long-term theory of capitalist accumulation is not free from the scourge of homogeneity either (see Appendix). Indeed I believe that there are in Marx two distinct and non-compatible macroeconomic theories. The first, of a Ricardian nature, is to be found in Volume One of Capital and culminates in the well known chapter (25) on the Reserve Army of Labour. Its essential elements are reproduced in Wage Price and Profit, a fact that has some importance. Wage Price and Profit is Marx’s speech at the founding meeting of the First International. It can, therefore, be viewed as expressing his core thoughts when economic statements had to be stripped down to their essential points. The second approach is contained in Volume Two of Capital, largely put together by Engels, which gave rise to the most far reaching set of economic debates within the Second International.
The work of Adolph Lowe can be considered as a milestone in the construction of a theoretical fra... more The work of Adolph Lowe can be considered as a milestone in the construction of a theoretical framework in which the stability of full employment as well as its attainment become inseparable from the ex-ante planning of sectoral proportions. At the same time, the ex-post planning of the adjustment path is required whenever the initial quantitative assumptions turn out to be incorrect.1 The remarkable characteristic of Lowe’s approach consists in the fact that it permits formulating an argument for planning under conditions of economic maturity. This point is rather important because most works on planning have, so to speak, subsumed the historical fact that socialist planned economies grew out of a social transformation of hitherto “backward” societies. As a result, the emphasis was mainly laid on questions of capital formation in the sense of the mobilization of the existing economic structure in order to produce an altogether different one in a relatively short span of time. The dynamics of sectoral proportions has been analyzed mostly in terms of the speed in which the new structure can be built in a context where the “backward” sector is identified with an unlimited supply of labor.2 Hence, because of the historical link between planned economies and the emancipation from backwardness, intersectoral (Marxian) type models have been produced with the aim of studying issues concerning the possibilities of, and the obstacles to, accelerated accumulation.
DOAJ (DOAJ: Directory of Open Access Journals), Dec 1, 2013
Il lavoro si occupa dei colli di bottiglia che possono sorgere nel processo di sviluppo economico... more Il lavoro si occupa dei colli di bottiglia che possono sorgere nel processo di sviluppo economico in un'economia capitalistica . L' autore mette a confronto il modello trisectoral di Adolph Lowe con l'analisi di John Hicks ' della traversata . Egli conclude che , in condizioni compatibili con la piena occupazione , il modello di Hick implica un certo grado di determinismo che il trattamento di Lowe , e in grado di evitare . The work deals with the bottlenecks that may arise in the process of economic development in a capitalist economy. The author compares Adolph Lowe’s trisectoral model with John Hicks’ analysis of the traverse. He concludes that by looking at the conditions compatible with full employment, Hick’s model implies a degree of determinism that Lowe’s treatment, by allowing for the formation of unused capacity and unemployment, is able to avoid. JEL: E22, E24
This chapter discusses the Kaldorian and Post-Keynesian approaches to inflation. The main thrust ... more This chapter discusses the Kaldorian and Post-Keynesian approaches to inflation. The main thrust of the chapter is a critique of the notion of a fixed markup. Through the use of a two sector capital goods-consumption goods model with sectoral degrees of capacity utilisation, it is shown that the markup itself varies according to changes in the sectoral structure of the economy, including nonuniform changes in the sectoral rates of utilisation. It is suggested that viewing inflation as stemming from money wage increases relatively to productivity is not as robust as it might appear in some of the Post-Keynesian literature.
This work argues that the dominance of supply-side considerations in the macroeconomic policy deb... more This work argues that the dominance of supply-side considerations in the macroeconomic policy debate has led towards depression at a world level, particularly in transitional and developing economies. The book suggests that it is necessary to rehabilitate the role of effective demand.
This chapter argues that Hicks’s Capital and Growth, and its rewritten version Methods of Dynamic... more This chapter argues that Hicks’s Capital and Growth, and its rewritten version Methods of Dynamic Economics, constitute a critique of both Neo-classical and Classical economics. The critique of the Neo-classical side is explicit: it appears in the series of explanations concerning the necessity to abandon the Temporary Equilibrium method of Value and Capital. Furthermore, the way in which Hicks argues against the assumption of a given aggregate saving ratio takes him straight into the Kaldor-Pasinetti Cambridge Equation. Having jettisoned both the Temporary Equilibrium and the Harrod type Fixprice methods, Hicks ends up with Sraffa type prices of production. By inserting those prices into the saving equation he obtains a model where any change in the natural growth rate implies a change in the distribution of income a la Kaldor with the underlying prices being determined a la Sraffa.
This chapter will discuss Adolph Lowe’s (1955, 1976) contributions by positioning them in relatio... more This chapter will discuss Adolph Lowe’s (1955, 1976) contributions by positioning them in relation to the accumulation and crisis debate developed by Russian and German Marxism at the turn of the century (Section 2), to the question of the traverse in a mature economy (Section 3), and to the quasi-structural theories of development of Maurice Dobb and of the Indian school of planning (Section 4).
The work takes up some issues raised by Kalecki in his posthumously published article “Class stru... more The work takes up some issues raised by Kalecki in his posthumously published article “Class struggle and distribution of national income”. By using Marx’s schemes of reproduction, Kalecki was able to prove that, in a given short period, a part of the wage bill is positively related to the level of profits in the consumption goods sector and through the latter, to the level of aggregate profits. Following Kalecki’s methodology of a two sector Marxian model, the author introduces inventories into the framework. In order to do so critical analysis of the supply functions postulated in most of his earlier works on oligopolistic pricing is provided. It is then demonstrated how even under the most favourable short-run technological conditions, bottlenecks may arise depending on the price/cost relation and on the level of inventories in the way described by Hicks. Finally, capital accumulation is introduced into the framework and it is argued that longer run inventories play a much reduced role.
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