What is wrong with heterodox economics? Kalecki’s profit theory as an example
AbstractKalecki’s profit theory has always been popular among heterodox economist as an alternative approach to solve the paradox of monetary profits. In the present paper his formula ‘The workers spend what they get, the capitalists get what they spend’ is scrutinized for its logical and factual implications. The analysis shows that Kalecki’s alternative approach points in the right direction but unfortunately shares a crucial conceptual error with standard economics.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 31177.
Date of creation: 18 May 2011
Date of revision:
National income accounting; Zero profit economy; Distributed profit; Income definition; Master equation;
Find related papers by JEL classification:
- E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
- E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
- B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
- B50 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - General
- B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-06-04 (All new papers)
- NEP-HME-2011-06-04 (Heterodox Microeconomics)
- NEP-HPE-2011-06-04 (History & Philosophy of Economics)
- NEP-MAC-2011-06-04 (Macroeconomics)
- NEP-PKE-2011-06-04 (Post Keynesian Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Keen, Steve, 2010.
"Solving the paradox of monetary profits,"
Economics - The Open-Access, Open-Assessment E-Journal,
Kiel Institute for the World Economy, vol. 4(31), pages 1-32.
- Kakarot-Handtke, Egmont, 2011.
"Keynes’s missing axioms,"
31179, University Library of Munich, Germany.
- Tony Lawson, 2006. "The nature of heterodox economics," Cambridge Journal of Economics, Oxford University Press, vol. 30(4), pages 483-505, July.
- Bruun, Charlotte & Heyn-Johnsen, Carsten, 2009. "The paradox of monetary profits: an obstacle to understanding financial and economic Crisis?," Economics Discussion Papers 2009-52, Kiel Institute for the World Economy.
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