IDEAS home Printed from https://ideas.repec.org/a/nea/journl/y2017i35p53-69.html
   My bibliography  Save this article

A Basic Neomarxist Model of Economic Fluctuations

Author

Listed:
  • Plushchevskaya, Y.

    (The Central Bank of the Russian Federation, Moscow, Russia)

Abstract

The world economic and financial crisis has revealed the weakness of modern economics mainstream theories and the related models in explaining the capitalist economy dynamics. These are first of all real business cycles and New Keynesian dynamic stochastic general equilibrium models. They treat economic fluctuations as a result of unexpected shocks. The Marx's reproduction theory can become an alternative as it analyses cyclicality as an immanent feature of the capitalist mode of production arising from fundamental contradictions between labour and capital. Some of its concepts have been formalized in the predator-prey "Class-Struggle Model" by R. Goodwin. The model was a theoretical tool to investigate interactions between changes in employment rate (a labour market indicator) and share of labour in national income (representing a distribution of the value produced between workers and capitalists). Nevertheless, nor it neither subsequent modifications were empirically valid. Researchers who tried to verify the models by bringing them to data have pointed to a misspecification as a possible reason. To our mind, the point is that the models by R. Goodwin and his disciples reflect a distributive conflict between labour and capital which is subordinate to the main contradiction regarding production relations. The article states a prey-predator type model version based on the reproduction theory by K. Marx. The variables are productive capital and surplus value which change in time along damped oscillations trajectories. Within the present framework the economic dynamics is seen as a subsequence of damped fluctuations each of which is characterised by own specific parameters (amplitude, duration), which in turn depend on fostered innovations and their diffusion in the economy.

Suggested Citation

  • Plushchevskaya, Y., 2017. "A Basic Neomarxist Model of Economic Fluctuations," Journal of the New Economic Association, New Economic Association, vol. 35(3), pages 53-69.
  • Handle: RePEc:nea:journl:y:2017i:35:p:53-69
    as

    Download full text from publisher

    File URL: http://www.econorus.org/repec/journl/2017-35-53-69r.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Matsuyama, Kiminori, 2001. "Growing through Cycles in an Infinitely Lived Agent Economy," Journal of Economic Theory, Elsevier, vol. 100(2), pages 220-234, October.
    2. van der Ploeg, F., 1987. "Growth cycles, induced technical change, and perpetual conflict over the distribution of income," Journal of Macroeconomics, Elsevier, vol. 9(1), pages 1-12.
    3. Shah, Anup & Desai, Meghnad, 1981. "Growth Cycles with Induced Technical Change," Economic Journal, Royal Economic Society, vol. 91(364), pages 1006-1010, December.
    4. Michael Wickens, 2008. "The Centralized Economy, from Macroeconomic Theory: A Dynamic General Equilibrium Approach," Introductory Chapters, in: Macroeconomic Theory: A Dynamic General Equilibrium Approach, Princeton University Press.
    5. Michael Wickens, 2008. "Imperfectly Flexible Prices, from Macroeconomic Theory: A Dynamic General Equilibrium Approach," Introductory Chapters, in: Macroeconomic Theory: A Dynamic General Equilibrium Approach, Princeton University Press.
    6. Alberto Martin & Jaume Ventura, 2012. "Economic Growth with Bubbles," American Economic Review, American Economic Association, vol. 102(6), pages 3033-3058, October.
    7. Tavani Daniele & Zamparelli Luca, 2015. "Endogenous technical change, employment and distribution in the Goodwin model of the growth cycle," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 19(2), pages 209-216, April.
    8. Hiroaki Sasaki, 2013. "Cyclical growth in a Goodwin–Kalecki–Marx model," Journal of Economics, Springer, vol. 108(2), pages 145-171, March.
    9. Kiminori Matsuyama, 1999. "Growing Through Cycles," Econometrica, Econometric Society, vol. 67(2), pages 335-348, March.
    10. Michael Wickens, 2008. "Asset Pricing and Macroeconomics, from Macroeconomic Theory: A Dynamic General Equilibrium Approach," Introductory Chapters, in: Macroeconomic Theory: A Dynamic General Equilibrium Approach, Princeton University Press.
    11. J. Kay., 2012. "The Map Is Not the Territory: An Essay on the State of Economics," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 5.
    12. Harvie, David, 2000. "Testing Goodwin: Growth Cycles in Ten OECD Countries," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 24(3), pages 349-376, May.
    13. Nelson H. Barbosa‐Filho & Lance Taylor, 2006. "Distributive And Demand Cycles In The Us Economy—A Structuralist Goodwin Model," Metroeconomica, Wiley Blackwell, vol. 57(3), pages 389-411, July.
    14. Moura, N.J. & Ribeiro, Marcelo B., 2013. "Testing the Goodwin growth-cycle macroeconomic dynamics in Brazil," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 392(9), pages 2088-2103.
    15. Daniele Tavani & Luca Zamparelli, 2013. "Endogenous Technical Change, Employment and Distribution in the Goodwin Model," IMK Working Paper 127-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    16. Mario Garcia Molina & Alba Avila & Ibrahim Massy, 2010. "Quantitative Evidence of Goodwins Non Linear Growth Cycles," Documentos de Trabajo, Escuela de Economía 7465, Universidad Nacional de Colombia, FCE, CID.
    17. Sordi, Serena & Vercelli, Alessandro, 2014. "Unemployment, income distribution and debt-financed investment in a growth cycle model," Journal of Economic Dynamics and Control, Elsevier, vol. 48(C), pages 325-348.
    18. A. Klepach & G. Kuranov., 2013. "Cyclical Waves in the Economic Development of the U.S. and Russia," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 11.
    19. Desai, Meghnad & Henry, Brian & Mosley, Alexander & Pemberton, Malcolm, 2006. "A clarification of the Goodwin model of the growth cycle," Journal of Economic Dynamics and Control, Elsevier, vol. 30(12), pages 2661-2670, December.
    20. A. Buzgalin & A. Kolganov., 2009. "World Economic Crisis and Scenarios of Post-crisis Development: Marxist Analysis," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
    21. V. Mayevsky & S. Malkov., 2014. "Perspectives of the Macroeconomic Reproduction Theory," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 4.
    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. 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.
    2. Daniele Tavani & Luca Zamparelli, 2020. "Growth, income distribution, and the ‘entrepreneurial state’," Journal of Evolutionary Economics, Springer, vol. 30(1), pages 117-141, January.
    3. Kerim Eser Afc{s}ar & Mehmet Ozyi~git & Yusuf Yuksel & Umit Ak{i}nc{i}, 2021. "Testing the Goodwin Growth Cycles with Econophysics Approach in 2002-2019 Period in Turkey," Papers 2106.02546, arXiv.org.
    4. Mariolis Theodore & Konstantakis Konstantinos N. & Michaelides Panayotis G. & Tsionas Efthymios G., 2019. "A non-linear Keynesian Goodwin-type endogenous model of the cycle: Bayesian evidence for the USA," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 23(1), pages 1-16, February.
    5. Stamegna, Marco, 2022. "A Kaleckian growth model of secular stagnation with induced innovation," MPRA Paper 113794, University Library of Munich, Germany.
    6. Jose Barrales‐Ruiz & Ivan Mendieta‐Muñoz & Codrina Rada & Daniele Tavani & Rudiger von Arnim, 2022. "The distributive cycle: Evidence and current debates," Journal of Economic Surveys, Wiley Blackwell, vol. 36(2), pages 468-503, April.
    7. Konstantakis, Konstantinos N. & Michaelides, Panayotis G. & Mariolis, Theodore, 2018. "A non-linear post-Keynesian Goodwin-type endogenous model of the cycle for the USA," MPRA Paper 90036, University Library of Munich, Germany.
    8. Hiroaki Sasaki, 2013. "Cyclical growth in a Goodwin–Kalecki–Marx model," Journal of Economics, Springer, vol. 108(2), pages 145-171, March.
    9. Matheus R. Grasselli & Aditya Maheshwari, 2018. "Testing a Goodwin model with general capital accumulation rate," Papers 1803.01536, arXiv.org.
    10. Marwil J. Dávila-Fernández, 2018. "Alternative Approaches to Technological Change when Growth is BoPC," Department of Economics University of Siena 795, Department of Economics, University of Siena.
    11. Dávila-Fernández, Marwil J. & Sordi, Serena, 2019. "Distributive cycles and endogenous technical change in a BoPC growth model," Economic Modelling, Elsevier, vol. 77(C), pages 216-233.
    12. Sordi, Serena & Vercelli, Alessandro, 2014. "Unemployment, income distribution and debt-financed investment in a growth cycle model," Journal of Economic Dynamics and Control, Elsevier, vol. 48(C), pages 325-348.
    13. Daniele Tavani, 2013. "Bargaining over productivity and wages when technical change is induced: implications for growth, distribution, and employment," Journal of Economics, Springer, vol. 109(3), pages 207-244, July.
    14. Stamegna, Marco, 2022. "Induced innovation, the distributive cycle, and the changing pattern of labour productivity cyclicality: a SVAR analysis for the US economy," MPRA Paper 113855, University Library of Munich, Germany.
    15. Stamegna, Marco, 2022. "Wage inequality and induced innovation in a classical-Marxian growth model," MPRA Paper 113805, University Library of Munich, Germany.
    16. Sasaki, Hiroaki & Asada, Yasukuni, 2020. "Quantifying Goodwin Growth Cycles with Minimum Wage Shares," MPRA Paper 99926, University Library of Munich, Germany.
    17. DJINKPO, Medard, 2019. "A DSGE model for Fiscal Policy Analysis in The Gambia," MPRA Paper 97874, University Library of Munich, Germany, revised 30 Dec 2019.
    18. Pedro Garcia Duarte, 2015. "From real business cycle and new Keynesian to DSGE Macroeconomics: facts and models in the emergence of a consensus," Working Papers, Department of Economics 2015_05, University of São Paulo (FEA-USP).
    19. Olkhov, Victor, 2023. "Economic Theory as Successive Approximations of Statistical Moments," MPRA Paper 118722, University Library of Munich, Germany.
    20. Shafik Hebous, 2011. "The Effects Of Discretionary Fiscal Policy On Macroeconomic Aggregates: A Reappraisal," Journal of Economic Surveys, Wiley Blackwell, vol. 25(4), pages 674-707, September.

    More about this item

    Keywords

    economic dynamics; theory of reproduction; Marx models of cycle; predatorprey model;
    All these keywords.

    JEL classification:

    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

    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:nea:journl:y:2017i:35:p:53-69. 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: Alexey Tcharykov (email available below). General contact details of provider: https://edirc.repec.org/data/nearuea.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.