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Growth, Autonomous Demand And A Joint-Product Treatment Of Fixed Capital

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Author Info
Graham White
Abstract

The aim of this paper is to shed light on the idea of demand-led growth by exploring the relation between growth and autonomous demands in a two-sector model that includes fixed capital with variable efficiency. The paper considers disequilibrium only in relation to quantities, with prices set at their long-period levels. Results of computer simulations suggest that where producers' expectations of future growth allow for dispersion in past growth rates, as well future growth in autonomous demand, this may have a significant stabilizing effect on the dynamics of output and demand. Copyright © 2007 The Author; Journal compilation © 2007 Blackwell Publishing Ltd.

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Article provided by Blackwell Publishing in its journal Metroeconomica.

Volume (Year): 59 (2008)
Issue (Month): 1 (02)
Pages: 1-26
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Handle: RePEc:bla:metroe:v:59:y:2008:i:1:p:1-26

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