Skip Navigation


Cambridge Journal of Economics Advance Access originally published online on August 19, 2007
Cambridge Journal of Economics 2008 32(1):147-160; doi:10.1093/cje/bem012
This Article
Right arrow Full Text
Right arrow Full Text (PDF)
Right arrow All Versions of this Article:
32/1/147    most recent
bem012v1
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 Bhaduri, A.
Right arrow Search for Related Content
Related Collections
Right arrow E12 - Keynes; Keynesian; Post-Keynesian
Right arrow E21 - Consumption; Saving; Wealth
Right arrow E22 - Capital; Investment; Capacity
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.

On the dynamics of profit-led and wage-led growth

Amit Bhaduri*

* Financial support from Fonds zur Forderung der wissenschaftlichen Forschung (FWF), Vienna for this project (no.p18419-G05) at the Vienna Institute for International Economics (WIIW) is gratefully acknowledged

Address for correspondence: A-12 IFS Apartments, Mayur Vihar, New Delhi 110091, India; email: abhaduri40{at}hotmail.com

This paper examines how variable output and profit share jointly determine investment and saving, while the difference between investment and saving drives the changes in output and profit share. Analysis of the resulting pair of differential equations yields novel implications for the multiplier process. In this more general framework a number of separate strands of the Keynesian-inspired literature can be understood. In particular, the model incorporates both forced saving and profit squeeze to analyse the stability of the dynamical system, and brings out the complex relation between in and out-of-equilibrium profit-led and wage-led regimes.

Key Words: Profit-led • wage-led • In and out-of-equilibrium dynamics • Local • Liapunov stability • Stable–unstable bifurcation • Forced saving • Profit squeeze • Multiplier

JEL classifications:: B22, C62, D33, E12, E22, E31

Manuscript received May 20, 2005; final version received February 20, 2007.


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




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.