Redemption and Depression
AbstractAccording to prevailing methodological criteria, standard economics is definitively refuted. Joan Robinson’s wake-up call “Scrap the lot and start again” has therefore lost nothing of its original freshness and urgency. Yet, how can the restart succeed? This inquiry builds on structural axioms. First, conceptual consistency is assured and the confusion about profit and income is dissolved. The question of interest is then how a recession or depression develops as the result of the normal functioning of the monetary economy. This involves the identification of positive feedback. A very effective mechanism consists of the circular interaction of profit and distributed profit.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 50924.
Date of creation: 24 Oct 2013
Date of revision:
new framework of concepts; structure-centric; axiom set; randomness; market clearing; budget balancing; consumption economy; investment economy; credit expansion;
Find related papers by JEL classification:
- B59 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Other
- E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
- E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-11-02 (All new papers)
- NEP-HPE-2013-11-02 (History & Philosophy of Economics)
- NEP-MAC-2013-11-02 (Macroeconomics)
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