Abstract
Most Kaleckian models assume a perfectly elastic labor supply, an assumption that is questionable for many developed economies. This paper presents simple labor-constrained Kaleckian models and uses these models to compare the implications of financialization under labor-constrained and dual-economy conditions. The paper complements the analysis in Skott and Ryoo (2008) which did not include labor-constrained Kaleckian economies. We show that for plausible parameter values the financial changes commonly associated with financialization tend to be expansionary in both dual-economy and labor-constrained settings.
Original language | English |
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Journal | European Journal of Economics and Economic Policies: Intervention |
Volume | 5 |
Issue number | 2 |
Pages (from-to) | 357-386 |
Number of pages | 30 |
ISSN | 2052-7764 |
DOIs | |
Publication status | Published - Nov 2008 |
Bibliographical note
Publisher Copyright:© Intervention.
Keywords
- Financialization
- Kaleckian model
- Labor constraints
- Stock-flow consistency