IDEAS home Printed from https://ideas.repec.org/a/eej/eeconj/v13y1987i1p7-18.html
   My bibliography  Save this article

A Conflict Model of Stagflation

Author

Listed:
  • Dang T. Tran

Abstract

This paper introduces a Lotka-Volterra-Goodwin model to study inflation and unemployment in the context of the distributional conflict between labor and capital. It was shown that the 1960-81 period was marked by a positively-sloped, long-run Phillips curve which first rose only slightly but became steeper later on. The stagflation phenomenon was attributed to the dominance of the wage-push over the profit-push. It was found that during 1970s workers' expectations and demands for higher wages and living standards greatly exceeded the paying capacity of the economy which was already severely limited by the supply shocks.

Suggested Citation

  • Dang T. Tran, 1987. "A Conflict Model of Stagflation," Eastern Economic Journal, Eastern Economic Association, vol. 13(1), pages 7-18, Jan-Mar.
    • Handle: RePEc:eej:eeconj:v:13:y:1987:i:1:p:7-18
    as

    Download full text from publisher

    File URL: http://web.holycross.edu/RePEc/eej/Archive/Volume13/V13N1P7_18.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Shah, Anup & Desai, Meghnad, 1981. "Growth Cycles with Induced Technical Change," Economic Journal, Royal Economic Society, vol. 91(364), pages 1006-1010, December.
    2. Nicholas Kaldor, 1955. "Alternative Theories of Distribution," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 23(2), pages 83-100.
    3. Gordon, Robert J, 1975. "The Demand for and Supply of Inflation," Journal of Law and Economics, University of Chicago Press, vol. 18(3), pages 807-836, December.
    4. Hall, Robert E & Lilien, David M, 1979. "Efficient Wage Bargains under Uncertain Supply and Demand," American Economic Review, American Economic Association, vol. 69(5), pages 868-879, December.
    5. Costrell, Robert M, 1984. "Equilibrium Unemployment and Excess Capacity in Steady-State and Growth Cycles," Economica, London School of Economics and Political Science, vol. 51(201), pages 69-82, February.
    6. Arthur M. Okun, 1975. "Inflation: Its Mechanics and Welfare Costs," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 6(2), pages 351-402.
    7. Gardiner C. Means, 1975. "Simultaneous Inflation and Unemployment: A Challenge to Theory and Policy," Challenge, Taylor & Francis Journals, vol. 18(4), pages 6-20, September.
    8. Basil J. Moore, 1979. "The Endogenous Money Stock," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 2(1), pages 49-70, October.
    9. Desai, Meghnad, 1973. "Growth cycles and inflation in a model of the class struggle," Journal of Economic Theory, Elsevier, vol. 6(6), pages 527-545, December.
    10. George L. Perry, 1977. "Potential Output and Productivity," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 8(1), pages 11-60.
    11. Perloff, Jeffrey M. & Wachter, Michael L., 1979. "A production function--nonaccelerating inflation approach to potential output : Is measured potential output too high?," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 10(1), pages 113-163, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jacobo, Juan, 2022. "A multi time-scale theory of economic growth and cycles," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 143-155.
    2. Leroy Laney & Thomas Willett, 1983. "Presidential politics, budget deficits, and monetary policy in the United States; 1960–1976," Public Choice, Springer, vol. 40(1), pages 53-69, January.
    3. Mario Sportelli, 1995. "A Kolmogoroff generalized predator-prey model of Goodwin's growth cycle," Journal of Economics, Springer, vol. 61(1), pages 35-64, February.
    4. Araujo, Ricardo Azevedo & Dávila-Fernández, Marwil J. & Moreira, Helmar Nunes, 2019. "Some new insights on the empirics of Goodwin's growth-cycle model," Structural Change and Economic Dynamics, Elsevier, vol. 51(C), pages 42-54.
    5. Stamegna, Marco, 2022. "A Kaleckian growth model of secular stagnation with induced innovation," MPRA Paper 113794, University Library of Munich, Germany.
    6. Douglas A. Hibbs, Jr., 1982. "Public Concern about Inflation and Unemployment in the United States: Trends, Correlates, and Political Implications," NBER Chapters, in: Inflation: Causes and Effects, pages 211-232, National Bureau of Economic Research, Inc.
    7. Carl Chiarella & Peter Flaschel, 1999. "Disequilibrium Growth Theory: Foundations, Synthesis, Perspectives," Working Paper Series 85, Finance Discipline Group, UTS Business School, University of Technology, Sydney.
    8. Giuseppe Orlando & Mario Sportelli, 2021. "Growth and Cycles as a Struggle: Lotka–Volterra, Goodwin and Phillips," Dynamic Modeling and Econometrics in Economics and Finance, in: Giuseppe Orlando & Alexander N. Pisarchik & Ruedi Stoop (ed.), Nonlinearities in Economics, chapter 0, pages 191-208, Springer.
    9. Amitava Krishna Dutt, 2017. "Heterodox Theories Of Economic Growth And Income Distribution: A Partial Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1240-1271, December.
    10. Benjamin M. Friedman, 1980. "Postwar Changes in the American Financial Markets," NBER Working Papers 0458, National Bureau of Economic Research, Inc.
    11. Veneziani, Roberto & Mohun, Simon, 2006. "Structural stability and Goodwin's growth cycle," Structural Change and Economic Dynamics, Elsevier, vol. 17(4), pages 437-451, December.
    12. P. K. Trivedi & J. Rayner, 1978. "Wage Inertia and Comparison Effects in Australian Award Wage Determination, 1964‐74," The Economic Record, The Economic Society of Australia, vol. 54(2), pages 195-218, August.
    13. Vosgerau, Hans-Jürgen, 1982. "Goodwins Wachstumszyklus der Beschäftigung und Verteilung," Discussion Papers, Series I 168, University of Konstanz, Department of Economics.
    14. Stamegna, Marco, 2022. "Wage inequality and induced innovation in a classical-Marxian growth model," MPRA Paper 113805, University Library of Munich, Germany.
    15. Frédéric Lordon, 1991. "Théorie de la croissance : quelques développements récents [Première partie : la croissance récente]," Revue de l'OFCE, Programme National Persée, vol. 36(1), pages 157-211.
    16. Benjamin M. Friedman & Milton Friedman & A. W. Clausen, 1980. "Postwar Changes in the American Financial Markets," NBER Chapters, in: The American Economy in Transition, pages 9-100, National Bureau of Economic Research, Inc.
    17. Rudiger von Arnim & Jose Barrales, 2015. "Demand-driven Goodwin cycles with Kaldorian and Kaleckian features," Review of Keynesian Economics, Edward Elgar Publishing, vol. 3(3), pages 351-373, July.
    18. Robert J. Gordon, 1979. "New Evidence that Fully Anticipated Monetary Changes Influence Real Output After All," Discussion Papers 369, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    19. Canavire-Bacarreza, Gustavo & Martínez-Vázquez, Jorge & Vulovic, Violeta, 2013. "Taxation and Economic Growth in Latin America," IDB Publications (Working Papers) 4583, Inter-American Development Bank.
    20. Zamparelli, Luca, 2022. "On Labor Productivity Growth and the Wage Share with Endogenous Size and Direction of Technical Change," MPRA Paper 112684, University Library of Munich, Germany.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eej:eeconj:v:13:y:1987:i:1:p:7-18. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Victor Matheson, College of the Holy Cross (email available below). General contact details of provider: https://edirc.repec.org/data/eeaa1ea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.