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Theory of Economic Dynamics
In his Essays in the Theory of Business Cycle published in Polish in 1933, Kalecki clearly stated the principle of effective demand in mathematical form. By 1935 he outlined his theory of employment, demolished the then-orthodox remedy for a depression-that is, wage cutting-and pinpointed the importance of investment for economic dynamics. Thus, although his training had been in Marxist economics, he succeeded in anticipating the Keynesian system, and, as Joan Robinson has pointed out, his claim to priority of publication is indisputable although he never mentioned this fact.
180 pages, Paperback
First published January 1, 1969
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February 24, 2025
Un sistema bastante interesante del que considero las siguientes conclusiones las más relevantes:
El ciclo capitalista presenta una tendencia estable que no es desarrollada de forma inherente al sistema, sino de los factores de desarrollo:
i. Ritmo de innovaciones (que comprende la apertura de mercados de materias primas).
ii. Ahorro rentista. Un aumento del ahorro improductivo tal como el especulativo reduce la capacidad de crecimiento.
iii. Un crecimiento demográfico sin redistribución del ingreso.
El nivel de monopolio se desarrolla también en un entorno cíclico. Aumenta en las crisis, disminuye en los auges. Por lo que su papel sobre el crecimiento entorpece principalmente la sección tercera, relacionada a la distribución del ingreso.
Interesante la propuesta sobre el ciclo de la inversión. Muy interesante la que considera que el papel de la inflación vía reducción de los salarios, es irrelevante, aunque teóricamente tenga un impacto. Esto porque aunque para los bancos una disminución de las transacciones pueda generar una caída de la tasa de interés, también es posible que se responda un una reducción de la velocidad del dinero vía reducción de la masa monetaria.
El mecanismo de la velocidad del dinero dinámica resulta también muy útil para la crítica a la ecuación cuantitativa del dinero.
El ciclo capitalista presenta una tendencia estable que no es desarrollada de forma inherente al sistema, sino de los factores de desarrollo:
i. Ritmo de innovaciones (que comprende la apertura de mercados de materias primas).
ii. Ahorro rentista. Un aumento del ahorro improductivo tal como el especulativo reduce la capacidad de crecimiento.
iii. Un crecimiento demográfico sin redistribución del ingreso.
El nivel de monopolio se desarrolla también en un entorno cíclico. Aumenta en las crisis, disminuye en los auges. Por lo que su papel sobre el crecimiento entorpece principalmente la sección tercera, relacionada a la distribución del ingreso.
Interesante la propuesta sobre el ciclo de la inversión. Muy interesante la que considera que el papel de la inflación vía reducción de los salarios, es irrelevante, aunque teóricamente tenga un impacto. Esto porque aunque para los bancos una disminución de las transacciones pueda generar una caída de la tasa de interés, también es posible que se responda un una reducción de la velocidad del dinero vía reducción de la masa monetaria.
El mecanismo de la velocidad del dinero dinámica resulta también muy útil para la crítica a la ecuación cuantitativa del dinero.
March 8, 2024
Starts off with a discussion of inelastic and elastic goods. Uses manufacturing statistics in the US and price indexes to create a mathematical equation for price formation. Then follows on to the share of wages, the determination of profits, and the implications for national economies. There's a connection to a book I read earlier — Matthew C. Klein's Trade Wars Are Class Wars — I thought of, when he discusses the importance of external markets and budget deficits for capitalists to make profits. It is in the drive for external markets that Kalecki finds a connection to imperialism, that imperialism is a drive for export surplus, as is armaments and wars.
I think that I probably would raise Jan Toporowski's recognition that Kalecki suffers from a lack of conception of credit and international banking, for a more nuanced form of "imperialism" than one might expect. One could look to Rosa Luxemburg's The Accumulation of Capital for an account of such from Kalecki's own Marxian economic school.
Kalecki's view of interest rates and money is shockingly monetarist in a sense, he largely finds, based on statistical evidence from UK Treasury Bills, the same MV=PT equation (the quantity theory of money) that Milton Friedman made popular. However, his focus is more on the velocity of circulation than a link between money and prices. This leads to an analysis of long-term interest rates, arguing that it does not show cyclical fluctuations and is not a crigical element in the business cycle. Analyses of the business cycle lead into theories of long-run economic development. Kalecki's major contribution to this area is claiming that specific "development factors" — innovations, rentiers' savings, and growth in population — to be the key parts of sustaining long-run capitalist development.
The book ends with "A decline in the intensity of innovations in the later stages of capitalist development results in a retardation of the increase in capital and output." Which is kind of a strong claim about late capitalism.
Anyways an interesting book, covers a pretty wide sweep of topics, and aside from being quite dry as Kalecki's writing is often guilty of, does provide some interesting food for thought.
I think that I probably would raise Jan Toporowski's recognition that Kalecki suffers from a lack of conception of credit and international banking, for a more nuanced form of "imperialism" than one might expect. One could look to Rosa Luxemburg's The Accumulation of Capital for an account of such from Kalecki's own Marxian economic school.
Kalecki's view of interest rates and money is shockingly monetarist in a sense, he largely finds, based on statistical evidence from UK Treasury Bills, the same MV=PT equation (the quantity theory of money) that Milton Friedman made popular. However, his focus is more on the velocity of circulation than a link between money and prices. This leads to an analysis of long-term interest rates, arguing that it does not show cyclical fluctuations and is not a crigical element in the business cycle. Analyses of the business cycle lead into theories of long-run economic development. Kalecki's major contribution to this area is claiming that specific "development factors" — innovations, rentiers' savings, and growth in population — to be the key parts of sustaining long-run capitalist development.
The book ends with "A decline in the intensity of innovations in the later stages of capitalist development results in a retardation of the increase in capital and output." Which is kind of a strong claim about late capitalism.
Anyways an interesting book, covers a pretty wide sweep of topics, and aside from being quite dry as Kalecki's writing is often guilty of, does provide some interesting food for thought.
September 13, 2024
While the writing is dull, I found this book very interesting.
His concluding outlook on the sustainability of a long-term capitalist economy was relatively negative. He claims that long-run development is not inherent to the capitalist economy. Specific development factors such as innovation are required, but the later stages of capitalist development result in a decline in the intensity of innovations.
Some general points I liked:
Unions reduce profit margins, decrease monopoly, and increase competition.
The connection between 'external' profits and imperialism, “The fight for the division of existing foreign markets and the expansion of colonial empires, which provide new opportunities for export of capital associated with export of goods, can be viewed as a drive for export surplus, the classical source of 'external' profits. Armaments and wars, usually financed by budget deficits, are also a source of this kind of profits.”
In a socialist economy, full employment would be maintained through the reduction of prices in relation to cost. Flexible prices can be characteristic feature of the socialist economy, just as in capitalism.
The amount of capital a firm can rent is overwhelmingly dependent on the amount they already have, and loans are imperative for economic growth.
Rentiers' savings introduce a negative trend in the system in somewhat the same way that innovations inject a long-run upward tendency.
In a static system, population growth leads to an increase in unemployment, a decrease in wages, the weakening of unions, an increase in the degree of monopoly, and a negative long-term impact in output.
Lastly, I couldn’t follow along with the bulk of the math, but I still found this book pretty accessible due to the various statistical illustrations price/wage indexes, and production data from the US/UK .
His concluding outlook on the sustainability of a long-term capitalist economy was relatively negative. He claims that long-run development is not inherent to the capitalist economy. Specific development factors such as innovation are required, but the later stages of capitalist development result in a decline in the intensity of innovations.
Some general points I liked:
Unions reduce profit margins, decrease monopoly, and increase competition.
The connection between 'external' profits and imperialism, “The fight for the division of existing foreign markets and the expansion of colonial empires, which provide new opportunities for export of capital associated with export of goods, can be viewed as a drive for export surplus, the classical source of 'external' profits. Armaments and wars, usually financed by budget deficits, are also a source of this kind of profits.”
In a socialist economy, full employment would be maintained through the reduction of prices in relation to cost. Flexible prices can be characteristic feature of the socialist economy, just as in capitalism.
The amount of capital a firm can rent is overwhelmingly dependent on the amount they already have, and loans are imperative for economic growth.
Rentiers' savings introduce a negative trend in the system in somewhat the same way that innovations inject a long-run upward tendency.
In a static system, population growth leads to an increase in unemployment, a decrease in wages, the weakening of unions, an increase in the degree of monopoly, and a negative long-term impact in output.
Lastly, I couldn’t follow along with the bulk of the math, but I still found this book pretty accessible due to the various statistical illustrations price/wage indexes, and production data from the US/UK .
June 1, 2025
Fantástica elaboração do Princípio da Demanda Efetiva do autor que parte do esquema de departamentalização com o qual Karl Marx demonstrou a dinâmica da acumulação de capital.
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