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Is Over-investment the Cause of the Post-2007 U.S. Economic Crisis?1

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  • Erdogan Bakir
  • Al Campbell

Abstract

A significant number of left political economists hold that the U.S. Great Recession and subsequent lethargic performance are a crisis of over-capacity that resulted from over-investment. Kotz (2011, 2013) has recently attempted to provide empirical support for this position. Despite sharing an understanding of the crisis very similar to his, the authors find in this paper that a careful examination of his evidence does not support considering this to be a crisis of over-investment.

Suggested Citation

  • Erdogan Bakir & Al Campbell, 2015. "Is Over-investment the Cause of the Post-2007 U.S. Economic Crisis?1," Review of Radical Political Economics, Union for Radical Political Economics, vol. 47(4), pages 550-557, December.
    • Handle: RePEc:sae:reorpe:v:47:y:2015:i:4:p:550-557
    DOI: 10.1177/0486613415584575
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    References listed on IDEAS

    as
    1. Weisskopf, Thomas E, 1979. "Marxian Crisis Theory and the Rate of Profit in the Postwar U.S. Economy," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 3(4), pages 341-378, December.
    2. Funke, Michael, 1986. "Influences on the Profitability of the Manufacturing Sector in the UK--An Empirical Study," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 48(2), pages 165-187, May.
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    More about this item

    Keywords

    over-investment; Marxian crisis theory; neoliberalism; Great Recession; business cycle;
    All these keywords.

    JEL classification:

    • B50 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - General
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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