tag:blogger.com,1999:blog-8595404115121834255.post5278150626859104548..comments2024-03-28T03:24:05.678-04:00Comments on NAKED KEYNESIANISM: Sraffian economics vs. Post Keynesian methodologyMatias Vernengohttp://www.blogger.com/profile/09521604894748538215noreply@blogger.comBlogger13125tag:blogger.com,1999:blog-8595404115121834255.post-85462356574557983632012-03-26T14:00:35.550-04:002012-03-26T14:00:35.550-04:00Fair enough Antonio, but what I think was nice of ...Fair enough Antonio, but what I think was nice of the debate is that it pointed out the common features of the Sraffians (the modern version of the old classical politica economy, or surplus approach) and the non-neoclassical Keynesians (i.e. the ones that do not believe that unemployment depends on rigidities). Sergio and Marc, respectively, are good examples of what classical-Keynesian economics is all about.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-79351587594006322962012-03-26T13:44:12.429-04:002012-03-26T13:44:12.429-04:00Good point. But Rowthorn is the one that started t...Good point. But Rowthorn is the one that started the modeling with an independent I function, rather than an accelerator. Hence, it open the possibility, once the share, instead of the rate, of profit was used for the profit-led regime. Rowthorn, as far as I know, has nothing against the idea of profit-led regimes, and the same can be said about Lance Taylor, who incorporated those into his models, after Blecker - the first one to formalize the idea of profit led in his 1989 CJE paper - introduced the idea. Also, the important issue that should concern you is why if the profit share increses, even if there is no demand would a firm invest more. By the way, I did read Rowthorn carefully, and used in my graduate classes for years, but thanks for your recommendation.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-64701229547836466312012-03-24T16:46:52.358-04:002012-03-24T16:46:52.358-04:00But in Rowthorn's paper of 1981 there is no pr...But in Rowthorn's paper of 1981 there is no profit-led. It is wholly wage-led. That is precisely the critic of Bhaduri-Marglin. In his later papers, Rowthorn may have turned to conservative arguments, I don't know, I haven't read him. But certainly in the 1981 paper, that I read an infinite amount of times, there is no profit led regime. It is not possible to have a profit led regime in his model. Because an increase in the capacity utilization rate not only affects one of the arguments of the investment function; it also increases the profit rate (which in this sense is not independent of demand) adding an additional impulse. This "double counting" of the capacity utilization rate was precisely what B-M criticized, and that's why they separated the components of the profit rate (and the same did Heinz Kurz). They follow Robinson' 1962 even closer: they explicitly say that investment depends on the profit rate, and then they decompose it in the capacity utilization and the profit share, which in their view is independent of demand. And Tracy Mott criticized them for that, in turn. The original Neo-Kaleckian models did not have a profit led regime. Critics tried to incorporate it, or even abolish the wage-led regime, like Dumenil-Levy, Skott and Vianello. I really recommend a reading of the original paper of Rowthorn, in my view it will clarify many thing regarding this issue, notwithstanding what he wrote before and after, which I haven't almost read at all.PGBhttps://www.blogger.com/profile/00176679709411717528noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-23535016911239024162012-03-24T15:05:56.983-04:002012-03-24T15:05:56.983-04:00Very good post.
There are many others discrepancia...Very good post.<br />There are many others discrepancias between sraffians and keynesians.<br />See, for example (sorry just in Spanish), especially the page#12 table:<br />http://www.ucm.es/info/nomadas/MA_sraffa/antoniogarrido.pdf<br />I think this differnce (long run prices as centres of gravitation) comes from the polemic between Garegnanni and Joan Robinson. See Garegnanni´s “Valore e Domanda Effetiva”, 1979,Einaudi Paperbacks.<br />Antonio.antonio garridohttps://www.blogger.com/profile/05718040485766541745noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-45034910226528559932012-03-24T10:37:35.127-04:002012-03-24T10:37:35.127-04:00Rowthorn (1981) is the seminal NK model, and it fo...Rowthorn (1981) is the seminal NK model, and it follows the Joan Robinson of the 1962, Essays in the Theory of Economic Growth, of the famous banana graph model. As correctly pointed by Sergio this models do not contain C. Also, more generally they have an exogenous I (independent of S as in B) that does not follow the accelerator. And that's how you get wage-led versus profit-led outcomes. But as I pointed out in another post the profit-led argument is a unicorn. Why firms are going to invest if there is no increase in demand. Although, these models are referred as Kaleckians they are anti-Kaleckians. Rowthorn's contributions in this area, more than Joan Robinson, have had a terrible effect, confusing and leading to conservative arguments. THeir ideological point with profit-led results was that Social Democracy (i.e. wage-led) was not possible anymore. As far as I know Rowthorn, like Bowles, Gintis and several others in that camp, have moved, not just theoretically, but politically too, to the right.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-33635521494671066392012-03-24T10:29:06.906-04:002012-03-24T10:29:06.906-04:00Hi Nathan. Read papers by Willi Semmler on the top...Hi Nathan. Read papers by Willi Semmler on the topic and others that cited his book "Competition, Monopoly, and Differential Profit Rates, New York: Columbia University Press." By the time I was at the New School in the 1990s he had moved to New Keynesian models. So in all fairness, I never read it directly. The general argument is that, if I recall correctly, there is no relation between barriers to entry (the old classical concept of competition being related to the absence of barriers) and profitability, and prices are not affected by monopoly power. In principle, I tend to believe in the centrality of the classical notion of competition.Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-33309352756627820032012-03-24T08:27:59.041-04:002012-03-24T08:27:59.041-04:00I just have some questions. Why do you say that Ne...I just have some questions. Why do you say that Neo-Kaleckian models come from Joan Robinson? From which Joan Robinson? From The accumulation of capital? From her last papers? Because basically Rowthorn's paper of 1981 (the first Neo-Kaleckian paper)goes precisely against The accumulation of capital (and Kaldor's 1955 paper). That paper aimed at overthrowing the notion that there was a negative relationship between the real wage and the accumulation rate. In Rowthorn, the relationship is positive, Bhaduri-Marglin attenuate that statement, and what they conclude is that one can expect ANY relationship, depending on the characteristics of the country, and I believe that is something Sraffians might agree with. I understand why Sraffians disagree with the Kaleckian rejection of a normal position (the only Kaleckian thing of this type of models), but I don't understand for instance the rejection by Vianello and Ciccone in the 80's, in which they emphatically reject the positive relation between real wage and accumulation, saying that it is necessarily negative. And that is something I don't think any post-keynesian (including Sraffians) would agree.<br />As for the use of a normal or fully adjusted position as a benchmark, I have given up any hopes of an agreement between both sides. It is a matter of "vision" (in the Schumpeterian sense), and when two visions diverge, is difficult that they come to terms. The difference is just how "normal", how persistent in real life, those normal positions are. I think that the most civilized thing to do, given the other many coincidences the two strands have, is just to accept each other terms when engaging in discussions, if the discussion is meant to be constructive.<br />Saludos,<br />Pablo.PGBhttps://www.blogger.com/profile/00176679709411717528noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-38383501009322695322012-03-24T01:33:58.220-04:002012-03-24T01:33:58.220-04:00I'd like to add that, in my opinion, a key fea...I'd like to add that, in my opinion, a key feature of Sraffian models is that they're anchored in reality because of their input-output basis; if, for example, one wishes to study the movements of market prices, this can't be done without a basis, rejecting production prices; these prices, thanks to their I-O basis, are an obligatory reference of any serious study of a capitalist economy.<br />That was precisely Garegnani's point when commenting on Kregel during the 1st Trieste Summer School back in the 80's (I'm lucky, just read him 2 days ago).Juan Carloshttps://www.blogger.com/profile/13914046428632561258noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-18580853163479791892012-03-23T18:26:21.053-04:002012-03-23T18:26:21.053-04:00Great post. Really does a good job of covering the...Great post. Really does a good job of covering the main issues. have you read semmler's 1984 book on this topic? If so, what did you think of it?Nathan Tankushttps://www.blogger.com/profile/16298104991209885385noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-70316235285363322922012-03-23T16:50:30.512-04:002012-03-23T16:50:30.512-04:00Oops. Fixed. Thanks Ramanan!Oops. Fixed. Thanks Ramanan!Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-67140473663785757632012-03-23T16:49:56.686-04:002012-03-23T16:49:56.686-04:00The question of instability is not specifically ab...The question of instability is not specifically about demand driven models. It is about the convergence of any model to its long term solution. On the Sraffian literature on gravitation I suggest this paper by Bellino and Serrano (http://es.scribd.com/capeluvoladora/d/58421308-Bellino-Serrano-Gravitation-Analysis-Beyond-Cross-dual-Models-and-Back-to-Adam-Smith-2011)Matias Vernengohttps://www.blogger.com/profile/09521604894748538215noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-68048271526769454292012-03-23T16:29:39.190-04:002012-03-23T16:29:39.190-04:00Lot of nice information!
By the way your first li...Lot of nice information!<br /><br />By the way your first link doesn't take one to the conference website.Ramananhttps://www.blogger.com/profile/11123448543333785121noreply@blogger.comtag:blogger.com,1999:blog-8595404115121834255.post-58951915332810795092012-03-23T16:23:00.174-04:002012-03-23T16:23:00.174-04:00You're great. I'm linking it to Cesaratto&...You're great. I'm linking it to Cesaratto's facebook. What I didn't understand was the problem of instability under a demand growth model.Genaro Grassohttps://www.blogger.com/profile/00208520798867606189noreply@blogger.com