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Growth, Exploitation and Class Inequalities

Author

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  • Galanis, Giorgos
  • Veneziani, Roberto
  • Yoshihara, Naoki

Abstract

This paper provides a formal dynamic analysis of exploitation, class inequalities and profits. A stylised model of a capitalist economy with two classes - workers and capitalists - is considered which extends Roemer [26, 27]. First, a dynamic generalisation of a key Marxian insight is provided by proving that the profitability of capitalist production is synonimous with the existence of exploitation. Second, it is shown that, in a competitive environment, asset inequalities are fundamental for the emergence of exploitation, but they are not sufficient for its persistence, both in equilibria with accumulation and growth, and, perhaps more surprisingly, in stationary intertemporal equilibrium paths. Finally, it is shown that labour-saving technical progress may yield persistent exploitation by ensuring the persistent abundance of labour.

Suggested Citation

  • Galanis, Giorgos & Veneziani, Roberto & Yoshihara, Naoki, 2016. "Growth, Exploitation and Class Inequalities," Discussion Paper Series 636, Institute of Economic Research, Hitotsubashi University.
  • Handle: RePEc:hit:hituec:636
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    References listed on IDEAS

    as
    1. Roberto Veneziani, 2013. "Exploitation, inequality and power," Journal of Theoretical Politics, , vol. 25(4), pages 526-545, October.
    2. Tracy Mott, 1989. "Kaleckianism vs. "New" Keynesianism," Economics Working Paper Archive wp_25, Levy Economics Institute.
    3. Graham White, 1999. "Rethinking Kalecki on the Trend and Cycle," Review of Political Economy, Taylor & Francis Journals, vol. 11(3), pages 341-353.
    4. Mark Setterfield & Ted Lovejoy, 2006. "Aspirations, bargaining power, and macroeconomic performance," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 29(1), pages 117-148.
    5. Roberto Veneziani & Naoki Yoshihara, 2015. "Exploitation in economies with heterogeneous preferences, skills and assets: An axiomatic approach," Journal of Theoretical Politics, , vol. 27(1), pages 8-33, January.
    6. Fernando M. Rugitsky, 2013. "Degree of monopoly and class struggle: political aspects of Kalecki's pricing and distribution theory," Review of Keynesian Economics, Edward Elgar Publishing, vol. 1(4), pages 447—464-4, October.
    7. Robert Dixon, 1981. "A Model of Distribution," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 3(3), pages 383-402, April.
    8. Naoki Yoshihara, 2017. "A Progress Report On Marxian Economic Theory: On The Controversies In Exploitation Theory Since Okishio (1963)," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1421-1448, December.
    9. Jonathan F. Cogliano & Roberto Veneziani & Naoki Yoshihara, 2016. "The Dynamics of Exploitation and Class in Accumulation Economies," Metroeconomica, Wiley Blackwell, vol. 67(2), pages 242-290, May.
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    12. Morishima, Michio, 1969. "Theory of Economic Growth," OUP Catalogue, Oxford University Press, number 9780198281641.
    13. Veneziani, Roberto, 2007. "Exploitation and time," Journal of Economic Theory, Elsevier, vol. 132(1), pages 189-207, January.
    14. Roberto Veneziani, 2012. "Analytical Marxism," Journal of Economic Surveys, Wiley Blackwell, vol. 26(4), pages 649-673, September.
    15. Amitava Dutt & Anindya Sen, 1997. "Union bargaining power, employment, and output in a model of monopolistic competition with wage bargaining," Journal of Economics, Springer, vol. 65(1), pages 1-17, February.
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    17. 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.
    18. Serena Sordi & Alessandro Vercelli, 2012. "Genesis and foundations of the multiplier: Marx, Kalecki and Keynes," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 20(2), pages 137-156.
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    Keywords

    Dynamics; accumulation; exploitation; classes;

    JEL classification:

    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • B24 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Socialist; Marxist; Scraffian

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