Thirlwall's Law debate in Investigación Económica

 

The other side

Jaime Ros, with Pedro Hugo Clavijo, wrote a critique of Thirlwall's Law (in Spanish). Replies by Carlos Ibarra here, Esteban Pérez here and myself here. Their rejoinder here. All in Spanish. Haven't read the whole rejoinder yet (just got it), but for some reason they insist that the supermultiplier implies that exports are always the main source of autonomous demand.* Hm, that's weird. Just puzzled by that one. They should read Bortis and Serrano (this one with Fabio Freitas). Oh well.

* In their words: "El problema con esta propuesta [el supermultiplicador], ... implícitamente está suponiendo que las exportaciones son el componente principal, aunque no único, de la demanda autónoma..." Translation: "The problem with this proposal [the supermultiplier],... is that implicitly presumes that exports are the main component, even if not the only one, of autonomous demand..."

Gets better. They agree with me on this. In their words:  "estamos de acuerdo con Vernengo cuando dice: '(…) el modelo de Thirlwall no es capaz de captar la complejidad del proceso de desarrollo asiático, el papel del Estado, de la inversión pública, del financiamiento de los bancos públicos, del papel jugado por factores geopolíticos asociados a la amenaza comunista, entre otras cosas'." Translation: "we agree with Vernengo when he says: '... Thirlwall's model is not capable of explaining the complexity of the Asian development process, the role of the State, of public investment, of public banks' financing, of the role played by geopolitical factors associated with the communist threat, among other things'." The rest of the paragraph they forgot to quote: "Several of these factors were operative through autonomous government spending. One cannot think about the Chinese case without public investment." That would be as in government spending is the main, even if not the only, source of autonomous demand.

PS: The whole issue of Investigación Económica is available here.

Investigación Económica at 70

Investigación Económica, a journal that has become the most important in México, is turning 70, and Ignacio Perrotini, the editor, is organizing a very interesting conference (disclosure, I'm in the board, and will be at the conference). Jesús Silva Herzog was the founder, and while he cannot be considered a structuralist, it is clear that he was very open to publish the authors that would become central for that school of thought in Latin America, like Juan Noyola Vázquez, the father of the structuralist theory of inflation, Hans Singer, of Prebisch-Singer fame, and Celso Furtado, a central figure in early structuralism and the Economic Commission for Latin America (ECLA) when Prebisch was the Executive Secretary. IE published original and translated articles of the main heterodox economists over the years, and now that it is bilingual it has become a central outlet for high quality heterodox research.  So if you cannot go to the conference, you can check the various issues in the link above.

PS: A partial list of the conference participants includes Amitava Dutt, Anthony Thirlwall, Carlo Panico, Guadalupe Mántey, Tom Palley and Jaime Ros among others.