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Distribution-led growth in the long run

Author

Listed:
  • Michalis Nikiforos

    (Levy Economics Institute of Bard College, New York, NY, USA)

Abstract

This paper examines the long-run fluctuations in growth and distribution through the prism of wage- and profit-led growth. It argues that the relation between distribution of income and growth changes over time and proposes an endogenous mechanism that leads to fluctuations between wage- and profit-led periods. The ephemeral character of distribution-led regimes needs to be taken into account when someone estimates empirically the effect of a change in distribution on utilization and growth. The model is a linear version of Goodwin's predator–prey model, but with a reversal of the roles for predator and prey; this is another way to conceptualize the symbiosis between the two classes within a capitalist economy. The aforementioned argument is also examined in relation to the double movement of Karl Polanyi and the inverse U-shaped curve proposed by Simon Kuznets.

Suggested Citation

  • Michalis Nikiforos, 2016. "Distribution-led growth in the long run," Review of Keynesian Economics, Edward Elgar Publishing, vol. 4(4), pages 391-408, October.
    • Handle: RePEc:elg:rokejn:v:4:y:2016:i:4:p391-408
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    Citations

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    Cited by:

    1. Tonni, Lorenzo, 2021. "Personal income distribution and the endogeneity of the demand regime," MPRA Paper 108298, University Library of Munich, Germany.
    2. W. Robert Brazelton, 2019. "Constant Full Employment Growth: The Economic Analysis and Policies of Leon Hirsch Keyserling, Council of Economic Advisors – The Truman Era and Beyond," The American Economist, Sage Publications, vol. 64(1), pages 82-94, March.
    3. Cem Oyvat & Oğuz Öztunalı & Ceyhun Elgin, 2020. "Wage‐led versus profit‐led demand: A comprehensive empirical analysis," Metroeconomica, Wiley Blackwell, vol. 71(3), pages 458-486, July.
    4. Stefan Ederer & Miriam Rehm, 2021. "Wealth inequality and aggregate demand," Metroeconomica, Wiley Blackwell, vol. 72(2), pages 405-424, May.
    5. Prante, Franz J., 2019. "Income distribution and the multiplier: An exploration of nonlinear distribution effects in linear Kaleckian distribution and growth models," IPE Working Papers 121/2019, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    6. Paul Carrillo‐Maldonado, 2023. "Partial identification for growth regimes: The case of Latin American countries," Metroeconomica, Wiley Blackwell, vol. 74(3), pages 557-583, July.
    7. Köhler, Kasper, 2018. "The limits to profit-wage redistribution: Endogenous regime shifts in Kaleckian models of growth and distribution," IPE Working Papers 112/2018, Berlin School of Economics and Law, Institute for International Political Economy (IPE).

    More about this item

    Keywords

    wage-led; profit-led; long swings; predator–prey;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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