Arbeitspapier
The macroeconomic implications of zero growth: A post-Keynesian approach
This paper tries to clarify some important aspects around the zero-growth discussion. Starting from an accounting perspective, we analyse the implications of zero growth and clarify the stability conditions of such an economy. This is complemented with a monetary circuit approach - which, like any model, has to respect the national income and financial accounting conventions. The latter allows us to show that a stationary economy, i.e an economy with zero net investment, is compatible with positive profits and interest rates. It is also argued that a stationary economy does not generate systemic financial instability, in the sense of rising or falling financial assets- or financial liabilities-income ratios, if the financial balances of each macroeconomic sector are zero. In order to analyse the dynamic stability of such an economy, we make use of an autonomous demand-led growth model driven by government expenditures. We show that a stable stationary state with zero growth, positive profits, and a positive interest rate is possible. However, the stable adjustment of government expenditure-capital and government debt-capital ratios to their long-run equilibrium values requires specific maxima for the propensity to consume out wealth and for the rate of interest, assuming a balanced government budget and zero retained earnings of the firm sector.
- Sprache
-
Englisch
- Erschienen in
-
Series: Working Paper ; No. 169/2021
- Klassifikation
-
Wirtschaft
Sustainable Development
Environment and Growth
Capitalist Systems: General
- Thema
-
Ecological macroeconomics
post-Keynesian economics
stationary-state economics
growth imperative
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Hein, Eckhard
Jimenez, Valeria
- Ereignis
-
Veröffentlichung
- (wer)
-
Hochschule für Wirtschaft und Recht Berlin, Institute for International Political Economy (IPE)
- (wo)
-
Berlin
- (wann)
-
2021
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Hein, Eckhard
- Jimenez, Valeria
- Hochschule für Wirtschaft und Recht Berlin, Institute for International Political Economy (IPE)
Entstanden
- 2021
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