IDEAS home Printed from https://ideas.repec.org/a/taf/revpoe/v16y2004i3p309-334.html
   My bibliography  Save this article

Keynes's multiplier in a two-sectoral framework

Author

Listed:
  • Jochen Hartwig

Abstract

This paper endeavours to reinterpret one of the most fundamental concepts of macroeconomics: the Keynesian investment multiplier. The multiplier is not interpreted as a dynamic process (or quantity reaction of output) nor as a logical relation (or ratio) between income and investment expenditure, but as an equilibrium condition that prescribes the proportionality between the two 'departments' of the economy (the consumption-goods and the investment-goods sector) necessary for 'completely successful reproduction'. The Marxian concept of reproduction schemes is combined with Keynes's 'fundamental psychological law' (which states that the marginal propensity to consume is positive and less than unity) to derive this result. This 'structural' view of the multiplier is then used to analyse questions relating to economic growth, capital accumulation and structural change.

Suggested Citation

  • Jochen Hartwig, 2004. "Keynes's multiplier in a two-sectoral framework," Review of Political Economy, Taylor & Francis Journals, vol. 16(3), pages 309-334.
    • Handle: RePEc:taf:revpoe:v:16:y:2004:i:3:p:309-334
    DOI: 10.1080/0953825042000225616
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/0953825042000225616
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/0953825042000225616?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Claude Gnos & Louis-Philippe Rochon, 2008. "The Keynesian Multiplier," Post-Print halshs-00314304, HAL.
    2. Pasinetti,Luigi, 1993. "Structural Economic Dynamics," Cambridge Books, Cambridge University Press, number 9780521432825.
    3. Johan Deprez, 1997. "Open-Economy Expectations, Decisions, and Equilibria: Applying Keynes’ Aggregate Supply and Demand Model," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 19(4), pages 599-615, July.
    4. L. Randall Wray, 1999. "Theories of Value and the Monetary Theory of Production," Economics Working Paper Archive wp_261, Levy Economics Institute.
    5. Lianos, Theodore P., 1979. "Domar's growth model and Marx's reproduction scheme," Journal of Macroeconomics, Elsevier, vol. 1(4), pages 405-412.
    6. Louis-Philippe Rochon, 1999. "Credit, Money and Production," Books, Edward Elgar Publishing, number 1565.
    7. Edward Nell, 2002. "On Realizing Profits in Money," Review of Political Economy, Taylor & Francis Journals, vol. 14(4), pages 519-530.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jochen Hartwig, 2014. "Relative Movements of Real Wages and Output," KOF Working papers 14-355, KOF Swiss Economic Institute, ETH Zurich.
    2. Jochen Hartwig, 2006. "Explaining the aggregate price level with Keynes's principle of effective demand," Review of Social Economy, Taylor & Francis Journals, vol. 64(4), pages 469-492.
    3. M. G. Hayes, 2008. "Keynes's Z function: a reply to Hartwig and Brady," Cambridge Journal of Economics, Oxford University Press, vol. 32(6), pages 1003-1003, November.
    4. Jochen Hartwig, 2017. "The Comparative Statics of Effective Demand," Review of Political Economy, Taylor & Francis Journals, vol. 29(3), pages 360-375, July.
    5. repec:pke:wpaper:pkwp1211 is not listed on IDEAS
    6. Gechert, Sebastian, 2012. "The multiplier principle, credit-money and time," MPRA Paper 34648, University Library of Munich, Germany.
    7. Mariolis, Theodore & Soklis, George, 2014. "The Sraffian Multiplier for the Greek Economy: Evidence from the Supply and Use Table for the Year 2010," MPRA Paper 60253, University Library of Munich, Germany.
    8. Jochen Hartwig, 2009. "D and Z in ROPE," KOF Working papers 09-243, KOF Swiss Economic Institute, ETH Zurich.

    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. Jochen Hartwig, 2006. "Explaining the aggregate price level with Keynes's principle of effective demand," Review of Social Economy, Taylor & Francis Journals, vol. 64(4), pages 469-492.
    2. Massimo Cingolani, 2015. "Sylos Labini su Marx: implicazioni per la politica economica (Sylos Labini on Marx: economic policy implications)," Moneta e Credito, Economia civile, vol. 68(269), pages 81-147.
    3. Massimo Cingolani, 2013. "Finance Capitalism: A Look at the European Financial Accounts," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 60(3), pages 249-290, May.
    4. Javidanrad, Farzad, 2021. "Paradox of Monetary Profit, Shortage of Money in Circulation & Financialisation," The Warwick Economics Research Paper Series (TWERPS) 1365, University of Warwick, Department of Economics.
    5. Pasinetti, Luigi L., 2021. "Economic theory and institutions," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 438-442.
    6. Ulrich Witt & Christian Gross, 2020. "The rise of the “service economy” in the second half of the twentieth century and its energetic contingencies," Journal of Evolutionary Economics, Springer, vol. 30(2), pages 231-246, April.
    7. Daniele Tavani & Luca Zamparelli, 2017. "Government spending composition, aggregate demand, growth, and distribution," Review of Keynesian Economics, Edward Elgar Publishing, vol. 5(2), pages 239-258, April.
    8. Matthias Firgo & Peter Mayerhofer, 2015. "Wissens-Spillovers und regionale Entwicklung - welche strukturpolitische Ausrichtung optimiert des Wachstum?," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 144, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    9. Engelbert Stockhammer & Paul Ramskogler, 2009. "Post-Keynesian economics How to move forward," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 6(2), pages 227-246.
    10. Andergassen, Rainer & Nardini, Franco & Ricottilli, Massimo, 2006. "Innovation waves, self-organized criticality and technological convergence," Journal of Economic Behavior & Organization, Elsevier, vol. 61(4), pages 710-728, December.
    11. Sasaki, Hiroaki, 2007. "The rise of service employment and its impact on aggregate productivity growth," Structural Change and Economic Dynamics, Elsevier, vol. 18(4), pages 438-459, December.
    12. Eckhard Hein, 2007. "Interest Rate, Debt, Distribution And Capital Accumulation In A Post‐Kaleckian Model," Metroeconomica, Wiley Blackwell, vol. 58(2), pages 310-339, May.
    13. Bellino, Enrico & Nerozzi, Sebastiano, 2013. "Causality and interdependence in Pasinetti's works and in the modern classical approach," MPRA Paper 52179, University Library of Munich, Germany.
    14. Wenzlaff, Ferdinand & Kimmich, Christian & Richters, Oliver, 2014. "Theoretische Zugänge eines Wachstumszwangs in der Geldwirtschaft," ZÖSS-Discussion Papers 45, University of Hamburg, Centre for Economic and Sociological Studies (CESS/ZÖSS).
    15. Damiete Emmanuel-Yusuf & Stephen Morse & Matthew Leach, 2017. "Resilience and Livelihoods in Supply Chains (RELISC): An Analytical Framework for the Development and Resilience of the UK Wood Fuel Sector," Sustainability, MDPI, vol. 9(4), pages 1-18, April.
    16. Yoann Verger, 2015. "Sraffa and ecological economics: review of the literature," Working Papers hal-01182894, HAL.
    17. Marc Lavoie & Mario Seccareccia, 2019. "Macroeconomics and natural rates: some reflections on Pasinetti’s fair rate of interest," Bulletin of Political Economy, Bulletin of Political Economy, vol. 13(2), pages 139-165, December.
    18. Ünal, Emre, 2014. "Export Price Stability and Compatibility of Euro under the Export- Biased Productivity Growth in Turkey: A Criticism against the Maastricht Inflation Criterion," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 1(1), pages 16-25.
    19. Michael Landesmann & Robert Stehrer, 1999. "The European Unemployment Problem: A Structural Approach," wiiw Working Papers 10, The Vienna Institute for International Economic Studies, wiiw.
    20. Dirk J. Bezemer, 2012. "Modelos contables y comprensión de la crisis financiera," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 14(26), pages 47-76, January-J.

    More about this item

    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:taf:revpoe:v:16:y:2004:i:3:p:309-334. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CRPE20 .

    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.