Wachstum durch das Nadelöhr begrenzter Budgets
[Growth through the Bottleneck of Limited Budgets]
AbstractThe interplay between supply and demand in the context of growth processes is examined. It is demonstrated that economic development is also significantly influenced by demand under classic, exchange-based hypotheses. Growth assumes that economic operators are willing to change the composition of their budgets. Any additional product must pass through the confines of an existing budget. Growth is not possible without a change in the preferences of solvent buyers. Factors like inventions, changes in society, new fashions or amended regulations can facilitate the integration of additional products. The willingness or resistance to change of potential buyers is thus a possible element in explaining the development of economies that do not fully utilize their production potential. Changes in the structure of demand can cause an economy to grow or shrink. Increases in demand funded by broadly spread savings that are ultimately recompensed – i.e. in form of a new matching of exchange relationships – create growth. Conversely, savings concentrated on certain products that lead to money saved being spent diffusely result in negative growth. In order to assess whether changes in state or state-influenced demand, technical innovations, shifts in society or wage adjustments are conducive to growth, the question has to be asked whether the integration of additional products into the budget is ultimately being encouraged. Government decisions, whether as a fiscal body or setter of standards, can influence the structure of demand and hence economic developments, strategically or unintentionally.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 35527.
Date of creation: 15 Jun 2011
Date of revision:
Wachstum; Nachfrage; Nachfragestruktur; Fiskalpolitik; neoklassisch;
Find related papers by JEL classification:
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-02-20 (All new papers)
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.:
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"The Endogeneity of the Natural Rate of Growth,"
Studies in Economics, Department of Economics, University of Kent
9821, Department of Economics, University of Kent.
- Miguel A. LeÛn-Ledesma & A. P. Thirlwall, 2002. "The endogeneity of the natural rate of growth," Cambridge Journal of Economics, Oxford University Press, Oxford University Press, vol. 26(4), pages 441-459, July.
- Mark Setterfield, 2003. "Supply and Demand in the Theory of Long-run Growth: Introduction to a symposium on demand-led growth," Review of Political Economy, Taylor & Francis Journals, Taylor & Francis Journals, vol. 15(1), pages 23-32.
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