Skip Navigation


Cambridge Journal of Economics Advance Access originally published online on January 16, 2007
Cambridge Journal of Economics 2007 31(4):563-580; doi:10.1093/cje/bel042
This Article
Right arrow Full Text
Right arrow Full Text (PDF)
Right arrow All Versions of this Article:
31/4/563    most recent
bel042v1
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Alert me to new issues of the journal
Right arrow Add to My Personal Archive
Right arrow Download to citation manager
Right arrowRequest Permissions
Google Scholar
Right arrow Articles by Lima, G. T.
Right arrow Articles by Meirelles, A. J. A.
Right arrow Search for Related Content
Related Collections
Right arrow E12 - Keynes; Keynesian; Post-Keynesian
Right arrow E22 - Capital; Investment; Capacity
Right arrow E32 - Business Fluctuations; Cycles
Right arrow E43 - Determination of Interest Rates; Term Structure of Interest Rates
Right arrow G21 - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
Right arrow G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure
Right arrow O41 - One, Two, and Multisector Growth Models
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us  
What's this?

© The Author 2007. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.

Macrodynamics of debt regimes, financial instability and growth

Gilberto Tadeu Lima and Antonio J. A. Meirelles*

* University of São Paulo and State University of Campinas, Brasil, respectively

Address for correspondence: Gilberto Tadeu Lima, University of São Paulo, Department of Economics, São Paulo, Brazil; e-mail: giltadeu{at}usp.br

This paper develops a post-Keynesian dynamic model of capacity utilisation and growth, in which the supply of credit-money is endogenous and firms' debt position—and thus the financial fragility of the economy à la Hyman Minsky—is explicitly modelled. The interest rate is set by banks as a markup over a base rate exogenously determined by the monetary authority. The banking markup varies with changes in capacity utilisation, while the debt ratio varies with changes in the rates of interest, capital accumulation and growth. Regarding dynamics, it is shown the possibility of relating the stability properties of a system with the interest rate and the debt ratio as state variables to the prevailing Minskyan regime—hedge, speculative or Ponzi.

Key Words: Debt regimes • Financial instability • Growth

JEL classifications: E12, E22

Manuscript received October 17, 2004; final version received July 17, 2006.


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us    What's this?


This article has been cited by other articles:


Home page
 Cambridge J EconHome page
S. Charles
Corporate debt, variable retention rate and the appearance of financial fragility
Camb. J. Econ., September 1, 2008; 32(5): 781 - 795.
[Abstract] [Full Text] [PDF]


Disclaimer: Please note that abstracts for content published before 1996 were created through digital scanning and may therefore not exactly replicate the text of the original print issues. All efforts have been made to ensure accuracy, but the Publisher will not be held responsible for any remaining inaccuracies. If you require any further clarification, please contact our Customer Services Department.