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Comparative Growth Dynamics in a Discrete-time Marxian Circuit of Capital Model

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  • Deepankar Basu

    (Department of Economics, University of Massachusetts, Amherst, MA, USA)

Abstract

In this paper, a discrete-time version of the Marxian circuit of capital model in Foley (1982, 1986a) is used to address two important theoretical issues of general interest to the heterodox economics tradition: profit-led versus wage-led growth, and the growth-reducing impact of non-production credit. First, it is demonstrated that both profit-led and wage-led growth regimes can be accommodated within the Marxian circuit of capital model. Second, it is demonstrated that, if the total flow of credit is large, the steady-state growth rate of a capitalist economy is negatively related to the share of consumption credit in total net credit.

Suggested Citation

  • Deepankar Basu, 2014. "Comparative Growth Dynamics in a Discrete-time Marxian Circuit of Capital Model," Review of Radical Political Economics, Union for Radical Political Economics, vol. 46(2), pages 162-183, June.
  • Handle: RePEc:sae:reorpe:v:46:y:2014:i:2:p:162-183
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    Citations

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    Cited by:

    1. Stephen Thompson, 2018. "Employment and fiscal policy in a Marxian model," Metroeconomica, Wiley Blackwell, vol. 69(4), pages 820-846, November.
    2. Michaelis Nikiforos, 2018. "Distribution-led growth through methodological lenses," FMM Working Paper 24-2018, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

    More about this item

    Keywords

    circuit of capital; economic growth; consumption credit; Marxian political economy;
    All these keywords.

    JEL classification:

    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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