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A reconstructive critique of IPE and GPE from a critical scientific realist perspective: An alternative Keynesian-Kaleckian approach

Listed author(s):
  • Khan, Haider
  • Patomäki, Heikki

This paper offers, first, a critique of the relative lack of economic theory in ‘British’ Global Political Economy and then use of neoclassical rational choice theory in American mainstream IPE from the perspective of critical scientific realism. Keynesian economic theories provide perhaps the most obvious alternative. Keynes’ General Theory has been followed by many, forming also the basis of Minsky’s long ignored but now, after the 2008-9 crisis, all of a sudden famous explorations on the mechanisms of financial markets. While a major leap forward, we argue that these theories are historically and conceptually limited. Keynes’ critique of neoclassical economic theory and his alternative theories of particularly the effective demand and of money and credit can be strengthened by following also a neo-Kaleckian approach which avoids some of the inconsistencies of neo-Keynesianism. We indicate where further conceptual work is required and provide several illustrations from the neo-Kaleckian and neo-Keynesian theory to suggest a partial agenda of further scientific work including the explanation of unnecessary and undesired global fluctuations, tendencies and crises and possible collective responses to them. We also suggest the possibility of going beyond Keynes and Kalecki in terms of a general field theory of global political economy that can accommodate the deep normative and institutional underpinnings of the historically evolving planetary political economy.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 49517.

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Date of creation: Aug 2013
Handle: RePEc:pra:mprapa:49517
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  1. Khan, Haider, 2008. "Making Globalization Work: Towards Global Economic Justice," MPRA Paper 7864, University Library of Munich, Germany, revised 2008.
  2. Haider Ali Khan, 2002. "The Extended Panda's Thumb and a New Global Financial Architecture," CIRJE F-Series CIRJE-F-163, CIRJE, Faculty of Economics, University of Tokyo.
  3. Robinson, Joan, 1977. "Michal Kalecki on the Economics of Capitalism," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 39(1), pages 7-17, February.
  4. Benjamin J. Cohen, 2008. "Introduction to International Political Economy: An Intellectual History," Introductory Chapters,in: International Political Economy: An Intellectual History Princeton University Press.
  5. John Weiss & Haider A. Khan (ed.), 2006. "Poverty Strategies in Asia," Books, Edward Elgar Publishing, number 4247.
  6. Richard Swedberg, 1986. "The Doctrine of Economic Neutrality of the IMF and the World Bank," Journal of Peace Research, Peace Research Institute Oslo, vol. 23(4), pages 377-390, December.
  7. Anthony P. Thirlwall, 2011. "The Balance of Payments Constraint as an Explanation of International Growth Rate Differences," PSL Quarterly Review, Economia civile, vol. 64(259), pages 429-438.
  8. Bhaduri, Amit & Marglin, Stephen, 1990. "Unemployment and the Real Wage: The Economic Basis for Contesting Political Ideologies," Cambridge Journal of Economics, Oxford University Press, vol. 14(4), pages 375-393, December.
  9. Haider Ali Khan, 2002. "On Paradigms, Theories and Models," CIRJE F-Series CIRJE-F-156, CIRJE, Faculty of Economics, University of Tokyo.
  10. The Editors, 1986. "A Note on Wage Determination and Capital Accumulation," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 8(3), pages 463-477, March.
  11. Arestis, Philip & Driver, Ciaran, 1987. "The effects of income distribution on consumer imports," Journal of Macroeconomics, Elsevier, vol. 9(1), pages 83-94.
  12. Haider A. Khan, 2002. "Innovation and Growth: A Schumpeterian Model of Innovation," CIRJE F-Series CIRJE-F-150, CIRJE, Faculty of Economics, University of Tokyo.
  13. G. C. Harcourt, 1965. "A Two‐Sector Model Of The Distribution Of Income And The Level Of Employment In The Short Run," The Economic Record, The Economic Society of Australia, vol. 41(93), pages 103-117, March.
  14. Bowles, Samuel & Gintis, Herbert, 1993. "A Political and Economic Case for the Democratic Enterprise," Economics and Philosophy, Cambridge University Press, vol. 9(01), pages 75-100, April.
  15. James, Jeffrey & Khan, Haider, 1997. "Technology choice and income distribution," World Development, Elsevier, vol. 25(2), pages 153-165, February.
  16. Liliana Basile & Neri Salvadori, 1985. "Kalecki's Pricing Theory," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 7(2), pages 249-262, January.
  17. John Carson, 1994. "Existence and Uniqueness of Solutions to Kalecki’s Pricing Equations," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 16(3), pages 411-434, March.
  18. Khan, Haider, 2008. "Building an Innovative Economy through Managed Creative Destruction: A Theory with Applications to South Korea," MPRA Paper 7713, University Library of Munich, Germany, revised 2008.
  19. A. Asimakopulos, 1975. "A Kaleckian Theory of Income Distribution," Canadian Journal of Economics, Canadian Economics Association, vol. 8(3), pages 313-333, August.
  20. Khan, Haider, 2008. "Causal Depth contra Humean Empiricism: Aspects of a Scientific Realist Approach to Explanation," MPRA Paper 8297, University Library of Munich, Germany, revised 2008.
  21. Steindl, Josef, 1979. "Stagnation Theory and Stagnation Policy," Cambridge Journal of Economics, Oxford University Press, vol. 3(1), pages 1-14, March.
  22. Marco Crocco, 2002. "The concept of degrees of uncertainty in Keynes, Shackle, and Davidson," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 12(2), pages 11-28, July-Dece.
  23. Kalecki, Michal, 1971. "Class Struggle and the Distribution of National Income," Kyklos, Wiley Blackwell, vol. 24(1), pages 1-9.
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