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Corporate Debt Dynamics, Capital Accumulation, and Macroeconomic Instability: A Post-Keynesian Analysis

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Listed:
  • Min-Chang Ko

    (Wonkwang University)

  • Sangheon Lee

    (Korea University)

Abstract

This study presents a simple model of corporate debt dynamics within the framework of the post-Keynesian theory of growth and distribution. Our model introduces corporate debt dynamics into a modified version of Lavoie's Minsky?Steindl model, yielding long-run results different from those of Lavoie (1995) and Hein (2007) by showing that a stable long-run equilibrium exists in both puzzling and normal cases. On the basis of these results, this study shows that Minsky��s financial instability as well as Steindl��s paradox of debt as a phenomenon of macroeconomic instability can be formulated within the framework of a post-Keynesian debt dynamics system.

Suggested Citation

  • Min-Chang Ko & Sangheon Lee, 2015. "Corporate Debt Dynamics, Capital Accumulation, and Macroeconomic Instability: A Post-Keynesian Analysis," Korean Economic Review, Korean Economic Association, vol. 31, pages 177-197.
    • Handle: RePEc:kea:keappr:ker-20150630-31-1-07
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Corporate Debt Dynamics; Post-Keynesian Theory of Growth and Distribution; Macroeconomic Instability; Paradox of Debt;
    All these keywords.

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory

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