IDEAS home Printed from https://ideas.repec.org/a/efp/journl/v1y2015i2p1-34.html
   My bibliography  Save this article

The role of Aggregate Demand and Resource Distribution Policies in the elusive search for high Economic Growth rates

Author

Listed:
  • Luis Arce

    (Ministerio de Economía y Finanzas Públicas)

  • David Quiroz

    (Ministerio de Economía y Finanzas Públicas)

  • José Villegas

    (Ministerio de Economía y Finanzas Públicas)

Abstract

Can aggregate demand policies bring about economic growth in the long term? What is the impact of a better resource distribution on long-term economic growth in Bolivia? These questions are analyzed within the framework of a Kaleckian model of economic growth to make an empirical study of the relationships between the aggregate demand, distribution and growth. For estimating the structural behavior equations of the prevailing regimes in the Bolivian economy, Bayesian methods were used. The conclusions are that the Bolivian economy displays a wage-led demand regime and an overall contractive regime in the profit share (i.e. when the benefits in the profit share increase, economic growth goes down), and therefore a better resource distribution. When the aggregate demand increases, long-term economic growth will be greater. The results show that a decrease of 1% in the profit share, which increases the annual wage of the workers by approximately BOB 268.4, will lead to an annual aggregate output increase of 0,57%.

Suggested Citation

  • Luis Arce & David Quiroz & José Villegas, 2016. "The role of Aggregate Demand and Resource Distribution Policies in the elusive search for high Economic Growth rates," Cuadernos de Investigación Económica Boliviana, Ministerio de Economía y Finanzas Públicas de Bolivia, vol. 1(2), pages 1-34, July.
    • Handle: RePEc:efp:journl:v:1:y:2015:i:2:p:1-34
    as

    Download full text from publisher

    File URL: https://repositorio.economiayfinanzas.gob.bo/documentos/2018/UAEF/CIEB/ii_Art%C3%ADculos/Volumen%20I/N%C3%BAmero%202/CIEB_2016_Ing_Paper_3.pdf
    Download Restriction: no
    File URL: https://repositorio.economiayfinanzas.gob.bo/documentos/2018/UAEF/CIEB/ii_Art%C3%ADculos/Volumen%20I/N%C3%BAmero%202/CIEB_2016_Ing_Paper_3.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Growth; Distribution; Demand-Driven Accumulation Regime; Productivity Regime; Endogenous Technological Change; Bayesian Analysis;
    All these keywords.

    JEL classification:

    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:efp:journl:v:1:y:2015:i:2:p:1-34. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Unidad de Análisis y Estudios Fiscales (email available below). General contact details of provider: https://edirc.repec.org/data/mdhgvbo.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.