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Kalecki on money and finance

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  • Malcolm Sawyer

Abstract

It is argued that Kalecki had a greater appreciation of the role of the monetary sector than has been generally recognized, and that Kalecki presented ideas which can be seen as now embedded in the structuralist post Keynesian analysis of endogenous money and in the circuitist approach. Six key features of Kalecki's monetary analysis are identified. The paper outlines Kalecki's dismissal of the 'Pigou effect' and the 'Keynes effect', and then discussion the relationship between the 'principle of increasing risk' and the nature of the supply of credit. It discusses interest determination in Kalecki's writings and the manner in which he distinguished different types of money.

Suggested Citation

  • Malcolm Sawyer, 2001. "Kalecki on money and finance," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 8(4), pages 487-508.
    • Handle: RePEc:taf:eujhet:v:8:y:2001:i:4:p:487-508
    DOI: 10.1080/09672560110079502
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    References listed on IDEAS

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    1. L. R. Wray, 1990. "Money and Credit in Capitalist Economies," Books, Edward Elgar Publishing, number 474.
    2. Lavoie, Marc, 1996. "Horizontalism, Structuralism, Liquidity Preference and the Principle of Increasing Risk," Scottish Journal of Political Economy, Scottish Economic Society, vol. 43(3), pages 275-300, August.
    3. Robert Pollin, 1991. "Two Theories of Money Supply Endogeneity: Some Empirical Evidence," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 13(3), pages 366-396, March.
    4. Amitava Krishna Dult, 1987. "Competition, Monopoly Power and the Uniform Rate of Profit," Review of Radical Political Economics, Union for Radical Political Economics, vol. 19(4), pages 55-72, December.
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    Cited by:

    1. Georgios Argitis & Stella Michopoulou, 2011. "Are Full Employment and Social Cohesion Possible Under Financialization?," Forum for Social Economics, Springer;The Association for Social Economics, vol. 40(2), pages 139-155, July.
    2. Dodig, Nina & Herr, Hansjörg, 2015. "Theories of finance and financial crisis: Lessons for the Great Recession," IPE Working Papers 48/2015, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    3. Eckhard Hein, 2007. "Interest Rate, Debt, Distribution And Capital Accumulation In A Post‐Kaleckian Model," Metroeconomica, Wiley Blackwell, vol. 58(2), pages 310-339, May.
    4. Jan Toporowski, 2012. "The Monetary Theory of Kalecki and Minsky," Working Papers 172, Department of Economics, SOAS University of London, UK.
    5. Piacentini, P.M., 2021. "Minsky after Kalecki: real profits and financial structure," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 416-426.
    6. Alberto Chilosi, 2003. "Kalecki'S Theory Of Income Determination: A Reconstruction And An Assessment," Method and Hist of Econ Thought 0305001, University Library of Munich, Germany.
    7. Eckhard Hein, 2006. "Interest, Debt and Capital Accumulation—A Kaleckian Approach," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(3), pages 337-352.
    8. Greg Hannsgen & Tai Young-Taft, 2015. "Inside Money in a Kaldor-Kalecki-Steindl Fiscal Policy Model: The Unit of Account, Inflation, Leverage, and Financial Fragility," Economics Working Paper Archive wp_839, Levy Economics Institute.
    9. Rosser, J. Barkley & Rosser, Marina V., 2023. "The Bielefeld School of economics, Post Keynesian economics, and dynamic complexity," Journal of Economic Behavior & Organization, Elsevier, vol. 212(C), pages 454-465.

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