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Keynes after Sraffa and Kaldor: Effective demand, accumulation and productivity growth

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  • Alcino F. Camara-Neto and Matías Vernengo

Abstract

This paper analyzes to what extent John Maynard Keynes was successful in showing that the economic system tends to fluctuate around a position of equilibrium below full employment in the long run. It is argued that a successful extension of KeynesÂ’s principle of effective demand to the long run requires the understanding of the contributions by Piero Sraffa and Nicholas Kaldor. Sraffa provides the basis for the proper dismissal of the natural rate of interest, while the incorporation by Kaldor of the supermultiplier and VerdoornÂ’s Law allows for a theory of the rate of change of the capacity limit of the economy.

Suggested Citation

  • Alcino F. Camara-Neto and Matías Vernengo, 2010. "Keynes after Sraffa and Kaldor: Effective demand, accumulation and productivity growth," Working Paper Series, Department of Economics, University of Utah 2010_07, University of Utah, Department of Economics.
    • Handle: RePEc:uta:papers:2010_07
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    References listed on IDEAS

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    1. Magnus Blomström & Robert E. Lipsey & Mario Zejan, 1996. "Is Fixed Investment the Key to Economic Growth?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(1), pages 269-276.
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    Cited by:

    1. Sergio Cesaratto, 2012. "Neo-Kaleckian and Sraffian controversies on accumulation theory," Department of Economics University of Siena 650, Department of Economics, University of Siena.
    2. repec:uta:papers:2011_14 is not listed on IDEAS
    3. repec:uta:papers:2013_08 is not listed on IDEAS

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    Keywords

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    JEL classification:

    • B24 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Socialist; Marxist; Scraffian
    • E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General

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