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Redemption and Depression

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  • Kakarot-Handtke, Egmont

Abstract

According to prevailing methodological criteria, standard economics is definitively refuted. Joan Robinson’s wake-up call “Scrap the lot and start again” has therefore lost nothing of its original freshness and urgency. Yet, how can the restart succeed? This inquiry builds on structural axioms. First, conceptual consistency is assured and the confusion about profit and income is dissolved. The question of interest is then how a recession or depression develops as the result of the normal functioning of the monetary economy. This involves the identification of positive feedback. A very effective mechanism consists of the circular interaction of profit and distributed profit.

Suggested Citation

  • Kakarot-Handtke, Egmont, 2013. "Redemption and Depression," MPRA Paper 50924, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:50924
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    File URL: https://mpra.ub.uni-muenchen.de/50924/1/MPRA_paper_50924.pdf
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    References listed on IDEAS

    as
    1. Philip MIROWSKI, 1989. "The Rise and Fall of the Concept of Equilibrium in Economic Analysis," Discussion Papers (REL - Recherches Economiques de Louvain) 1989046, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    2. Kakarot-Handtke, Egmont, 2011. "Reconstructing the Quantity Theory (I)," MPRA Paper 32421, University Library of Munich, Germany.
    3. Tomasson, Gunnar & Bezemer, Dirk J, 2010. "What is the Source of Profit and Interest? A Classical Conundrum Reconsidered," MPRA Paper 20320, University Library of Munich, Germany.
    4. Keen, Steve, 2010. "Solving the paradox of monetary profits," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 4, pages 1-32.
    5. Keuzenkamp, H.A. & McAleer, M., 1994. "Simplicity, scientific inference and econometric modelling," Discussion Paper 1994-56, Tilburg University, Center for Economic Research.
    6. Hausman,Daniel M., 1992. "The Inexact and Separate Science of Economics," Cambridge Books, Cambridge University Press, number 9780521415019, April.
    7. Hausman,Daniel M., 1992. "The Inexact and Separate Science of Economics," Cambridge Books, Cambridge University Press, number 9780521425230, April.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    new framework of concepts; structure-centric; axiom set; randomness; market clearing; budget balancing; consumption economy; investment economy; credit expansion;

    JEL classification:

    • B59 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Other
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General

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