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Functional Distribution, Capital Accumulation and Growth in a Non-Linear Macrodynamic Model

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  • Gilberto Tadeu Lima

    (University of São Paulo)

Abstract

The article develops a macrodynamic model of income distribution,capital accumulation, and growth in which investment is nonlinear in distribution: at intermediate and high (low) levels of wage share, the impact of a higher profit share on investment plans is positive (negative). This specification conforms with some of the empirical evidence for the rise and fall of the Golden Age in several advanced economies. As it turns out, whether the economy follows a wage-led growth regime or a profit-led one depends on the prevailing distribution. Indeed, a similar dependence applies, alongside the relative bargaining power of capitalists and workers and the cyclical behavior of mark-ups, to the dynamic stability properties of the economy.

Suggested Citation

  • Gilberto Tadeu Lima, 2009. "Functional Distribution, Capital Accumulation and Growth in a Non-Linear Macrodynamic Model," Journal of Income Distribution, Ad libros publications inc., vol. 18(1), pages 3-19, March.
    • Handle: RePEc:jid:journl:y:2009:v:18:i:1:p:3-19
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    References listed on IDEAS

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    1. Glyn, Andrew, 1997. "Does Aggregate Profitability Really Matter?," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 21(5), pages 593-619, September.
    2. Kristin J. Forbes, 2000. "A Reassessment of the Relationship between Inequality and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 869-887, September.
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    Cited by:

    1. Gilberto Tadeu Lima, 2010. "Profit Sharing, Capacity Utilization and Growth in a Post-Keynesian Macromodel," Chapters, in: Mark Setterfield (ed.), Handbook of Alternative Theories of Economic Growth, chapter 17, Edward Elgar Publishing.
    2. Lídia Brochier, 2020. "Conflicting‐claims and labour market concerns in a supermultiplier SFC model," Metroeconomica, Wiley Blackwell, vol. 71(3), pages 566-603, July.
    3. Gilberto Tadeu Lima & Andre M. Marques, 2022. "Demand and Distribution in a Dynamic Spatial Panel Model for the United States: Evidence from State-Level Data," Working Papers, Department of Economics 2022_21, University of São Paulo (FEA-USP), revised 05 Oct 2022.

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    More about this item

    Keywords

    capital accumulation; distribution; growth;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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