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Supply and Demand in the Theory of Long-run Growth: Introduction to a symposium on demand-led growth

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  • Mark Setterfield

Abstract

Recent developments in growth theory have encouraged a revisionist interpretation of the field. According to this interpretation long-run growth should be, and always has been, interpreted as a supply-side process. The focus of this symposium is the macro-economics of demand-led growth. As a precursor to the contributions that follow, two central insights of demand-led growth theory are highlighted. First, chronic effective demand problems create a role for aggregate demand in determining the utilization rates of productive resources, even in the long run. Second, the demand-led actual rate of growth influences both the accumulation and productivity of factor inputs, and hence the economy's potential rate of growth.

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  • Mark Setterfield, 2003. "Supply and Demand in the Theory of Long-run Growth: Introduction to a symposium on demand-led growth," Review of Political Economy, Taylor & Francis Journals, vol. 15(1), pages 23-32.
    • Handle: RePEc:taf:revpoe:v:15:y:2003:i:1:p:23-32
    DOI: 10.1080/09538250308440
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    3. Vasiliki Bozani, 2011. "NAIRU, Unemployment and Post Keynesian Economics," Working Papers 1104, University of Crete, Department of Economics.
    4. Bonaventura, Luigi & Caserta, Maurizio, 2004. "An adaptive evolutionary behaviour for the demand-led growth adjustment," MPRA Paper 2527, University Library of Munich, Germany.
    5. Osmar Leandro Loaiza Quintero, 2012. "La demanda agregada y la distribución del ingreso: un estudio a partir de los modelos de crecimiento kaleckianos," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, December.
    6. Kai D. Schmid, 2010. "Medium-run macrodynamics and the consensus view of stabilization policy," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 322/2010, Department of Economics, University of Hohenheim, Germany.
    7. Klein, Rolf, 2011. "Wachstum durch das Nadelöhr begrenzter Budgets [Growth through the Bottleneck of Limited Budgets]," MPRA Paper 35527, University Library of Munich, Germany.
    8. Zhandos Ybrayev, 2022. "Balance-of-payments-constrained growth model: an application to the Kazakhstan’s economy," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 12(4), pages 745-767, December.
    9. Peter Flaschel & Sigrid Luchtenberg & Hagen Kramer & Christian Proano & Mark Setterfield, 2021. "Contemporary Macroeconomic Outcomes: A Tragedy in Three Acts," Working Papers 2105, New School for Social Research, Department of Economics.
    10. Amitava Krishna Dutt, 2006. "Aggregate Demand, Aggregate Supply and Economic Growth," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(3), pages 319-336.
    11. MASCA Simona-Gabriela & JUDE Cristina, 2009. "The Vicious Circle Of Fdi And Consumption In Romania," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 2(1), pages 417-423, May.
    12. Klein, Rolf, 2011. "Wachstum durch das Nadelöhr begrenzter Budgets," EconStor Research Reports 54763, ZBW - Leibniz Information Centre for Economics.
    13. J. E. King, 2010. "Six More Refuted Doctrines: A Comment on Quiggin," Economic Papers, The Economic Society of Australia, vol. 29(1), pages 34-39, March.
    14. Jochen Hartwig, 2005. "Sind unsere gesamtwirtschaftlichen Probleme ueberhaupt loesbar?," KOF Working papers 05-112, KOF Swiss Economic Institute, ETH Zurich.
    15. Steven M Fazzari & Piero Ferri & Anna Maria Variato, 2020. "Demand-led growth and accommodating supply," Cambridge Journal of Economics, Oxford University Press, vol. 44(3), pages 583-605.
    16. Laurent Oloukoi, 2020. "Demande extérieure et offre agricole de long terme: Cas des noix de cajou dans l'Union Economique et Monétaire Ouest‐Africaine (UEMOA)," African Development Review, African Development Bank, vol. 32(3), pages 486-498, September.
    17. Vasiliki Bozani, 2011. "NAIRU, Unemployment and Post Keynesian Economics," Working Papers 1105, University of Crete, Department of Economics.
    18. Loaiza Quintero, Osmar Leandro & Sierra Ríos, Ana Milena, 2010. "Salarios, demanda agregada y desempeño económico en Colombia: un debate no resuelto [Wages, aggregate demand and economic performance in Colombia: an unsolved debate]," MPRA Paper 42669, University Library of Munich, Germany.

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