Hostname: page-component-586b7cd67f-gb8f7 Total loading time: 0 Render date: 2024-11-23T10:25:33.523Z Has data issue: false hasContentIssue false
  • English
  • Français

A short-period growth cycle model1

Published online by Cambridge University Press:  17 August 2016

Jörg Glombowski  and
Michael Krüger
Jörg Glombowski
Affiliation:
Tilburg University
Michael Krüger
Affiliation:
University of Massachusetts
Get access

Summary

Goodwin's well-known growth cycle model has been rejected by Keynesians because it fails to take product disequilibria into account and gives rise to cycles which are much longer than observable business cycles. In the present article it is shown that cycles of much shorter duration can be obtained if the Goodwin model is modified by taking reactions to product market disequilibria into account. While shifts in income distribution between wages and profits remain the cycle maker, the modifications intensify the profit squeeze (and profit recovery) and thus speed up the cyclical process.

Résumé

Résumé

Les économistes keynesiens ont rejeté le modèle de croissance cyclique de Goodwin parce qu’il ne prenait pas en compte les déséquilibres sur le marché des produits et donnait naissance à des cycles d’une amplitude plus large que les cycles observables. Cet article montre que des cycles d’une amplitude plus courte peuvent être obtenus lorsqu’on modifìe le modèle de Goodwin en prenant en compte les réactions aux déséquilibres sur les marchés des produits. Les variations dans la répartition du revenu entre salaires et profits restent le moteur du cycle mais intensifient la décroissance (et la croissance) des profits et donc augmentent la rapidité du cycle.

Keywords

131131
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 54 , Issue 4 , 1988 , pp. 423 - 438
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 1988 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

1

Detailed criticism and constructive remarks by Robert M. Costrell, Peter Flaschel, Donald W. Katzner, Bruce Kelly, Aart de Zeeuw , and two referees of this journal are gratefully acknowledged.

References

REFERENCES

Allen, R.G.D. (1966), Mathematical Economics, London, Macmillan, 2nd edition.Google Scholar
Atkinson, A.B. (1969), The timescale of economic models : How long is the long run? Review of Economic Studies, 36, pp. 137–152.Google Scholar
Glombowski, J. and Krüger, M. (1987), Generalizations of Goodwin’s growth cycle model, in : Batten, D., Casti, J. and Johansson, B. (eds.), Economic Evolution and Structural Adjustment, Berlin, Springer, pp. 260–290.Google Scholar
Goodwin, R.M. (1967), A growth cycle, in : Feinstein, CH. (ed.), Socialism, Capitalism and Economic Growth : Essays Presented to Maurice Dobb, Cambridge, Cambridge University Press.Google Scholar
Goodwin, R.M. (1983), A note on wages, profits and fluctuating growth rates, Cambridge Journal of Economics, 7, pp. 305–309.Google Scholar
Kaplan, W. (1958), Ordinary Differential Equations, Reading, Addison-Wesley.Google Scholar
Lapidus, L. and Seinfeld, J.H. (1971), Numerical Solution of Ordinary Differential Equations, New York/London, Academic Press.Google Scholar
Marx, K. (1974), Capital. A Critique of Political Economy, vol.1, London, Lawrence & Wishart.Google Scholar
Robinson, J. (1969), An Essay on Marxian Economics, London, Macmillan, reprint of 2nd edition.Google Scholar
Solow, R.M. (1988), Goodwin’s growth cycle. Reminiscence and rumination, to appear.Google Scholar