RECONSIDERING THE INVESTMENT-PROFIT NEXUS IN FINANCE-LED ECONOMIES: AN ARDL-BASED APPROACH
A Post-Keynesian growth model is developed, in which financial variables are explicitly taken into account. Variants of an investment function are estimated econometrically, applying the ARDL (auto-regressive distributed lag)-based approach proposed by Pesaran et al. (Journal of Applied Econometrics, 16 (3), pp. 289-326). The econometric results are discussed with respect to a remarkable phenomenon that can be observed for some important OECD countries since the early 1980s: accumulation has generally been declining while profit shares and rates have shown a tendency to rise. We concentrate on one potential explanation of this phenomenon, which is particularly relevant for the USA and relies on a high propensity to consume out of capital income. Copyright © 2008 The Author. Journal compilation © 2008 Blackwell Publishing Ltd.
Year of publication: |
2008
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Authors: | Treeck, Till van |
Published in: |
Metroeconomica. - Wiley Blackwell, ISSN 0026-1386. - Vol. 59.2008, 3, p. 371-404
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Publisher: |
Wiley Blackwell |
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