IDEAS home Printed from https://ideas.repec.org/a/taf/revpoe/v15y2003i1p33-52.html
   My bibliography  Save this article

Technical Change, Effective Demand and Employment

Author

Listed:
  • Sergio Cesaratto
  • Franklin Serrano
  • Antonella Stirati

Abstract

Ricardo and Marx saw technological change as a possible cause of long-period unemployment. Neoclassical and Schumpeterian economists regard technological unem ployment as a transitory phenomenon. This paper argues that the capital critique (i) demolishes the neoclassical claim that market mechanisms will restore full employment whenever workers are displaced by technical change, and (ii) rehabilitates the old Ricardian argument that automatic compensation factors are generally absent. The neo-Schumpeterian notion of autonomous investment is also rejected, in favour of the view that, in the long period, all investment is induced. By extending Keynes's theory of effective demand to the long period through a model based on the supermultiplier, this paper suggests that the ultimate engines of growth are located in the autonomous components of effective demand--exports, government spending and autonomous con sumption. Technical change plays a role in the accumulation process through its effects on consumption patterns and the material input requirements. However, the impact of technical change is now seen to depend upon circumstances such as income distribution, the availability of bank liquidity and exchange rate policy.

Suggested Citation

  • Sergio Cesaratto & Franklin Serrano & Antonella Stirati, 2003. "Technical Change, Effective Demand and Employment," Review of Political Economy, Taylor & Francis Journals, vol. 15(1), pages 33-52.
    • Handle: RePEc:taf:revpoe:v:15:y:2003:i:1:p:33-52
    DOI: 10.1080/09538250308444
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/09538250308444
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09538250308444?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Cesaratto, Sergio, 1999. "Savings and Economic Growth in Neoclassical Theory," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 23(6), pages 771-793, November.
    2. Heinz D. Kurz & Neri Salvadori (ed.), 1998. "The Elgar Companion to Classical Economics," Books, Edward Elgar Publishing, volume 0, number 851, December.
    3. Kaldor, Nicholas, 1971. "Conflicts in National Economic Objectives," Economic Journal, Royal Economic Society, vol. 81(321), pages 1-16, March.
    4. P. Garegnani, 1970. "Heterogeneous Capital, the Production Function and the Theory of Distribution," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 37(3), pages 407-436.
    5. Anyadike-Danes, Michael & Godley, Wynne, 1989. "Real Wages and Employment: A Sceptical View of Some Recent Empirical Work," The Manchester School of Economic & Social Studies, University of Manchester, vol. 57(2), pages 172-187, June.
    6. Cowling, Keith, 1981. "Oligopoly, distribution and the rate of profit," European Economic Review, Elsevier, vol. 15(2), pages 195-224.
    7. Lindbeck, Assar & Snower, Dennis J, 1986. "Wage Setting, Unemployment, and Insider-Outsider Relations," American Economic Review, American Economic Association, vol. 76(2), pages 235-239, May.
    8. Pierangelo Garegnani & Antonella Palumbo, 1997. "Accomulation of capital," Departmental Working Papers of Economics - University 'Roma Tre' 0002, Department of Economics - University Roma Tre.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sergio Cesaratto, 2002. "The Economics of Pensions: A non-conventional approach," Review of Political Economy, Taylor & Francis Journals, vol. 14(2), pages 149-177.
    2. Ginzburg, Andrea & Simonazzi, Annamaria, 2005. "Patterns of industrialization and the flying geese model: the case of electronics in East Asia," Journal of Asian Economics, Elsevier, vol. 15(6), pages 1051-1078, January.
    3. Alejandro Rodríguez Arana, 2015. "The share of wages in national income and its effects in the short and long run economic activity and growth," Working Papers 0215, Universidad Iberoamericana, Department of Economics.
    4. Antonella Palumbo, 2008. "I metodi di stima del PIL potenziale tra fondamenti di Teoria economica e Contenuto empirico," Departmental Working Papers of Economics - University 'Roma Tre' 0092, Department of Economics - University Roma Tre.
    5. Fabio Petri, 2013. "Neglected implications of neoclassical capital-labour substitution for investment theory:another criticism of Say's Law," Department of Economics University of Siena 687, Department of Economics, University of Siena.
    6. Tony Aspromourgos, 2019. "The Past and Future of Keynesian Economics: A Review Essay," History of Economics Review, Taylor & Francis Journals, vol. 72(1), pages 59-78, January.
    7. Sergio Cesaratto, 2010. "Endogenous Growth Theory Twenty Years On: A Critical Assessment," Bulletin of Political Economy, Bulletin of Political Economy, vol. 4(1), pages 1-30, June.
    8. Eric Levin & Thomas Moutos, 1991. "Unemployment insurance and union bargaining — an insider-outsider approach," Journal of Economics, Springer, vol. 53(3), pages 271-284, October.
    9. Heinz D. Kurz & Neri Salvadori, 2011. "In Favor of Rigor and Relevance: A Reply to Mark Blaug," History of Political Economy, Duke University Press, vol. 43(3), pages 607-616, Fall.
    10. Mahmood Araï & Gérard Ballot & Ali Skalli, 1996. "Différentiels intersectoriels de salaire et caractéristiques des employeurs en France," Économie et Statistique, Programme National Persée, vol. 299(1), pages 37-58.
    11. Anabela Carneiro & Pedro Portugal, 2004. "Market Power, Dismissal Threat, and Rent Sharing: the Role of Insider and Outsider Forces in Wage Bargaining," CEF.UP Working Papers 0403, Universidade do Porto, Faculdade de Economia do Porto.
    12. Jean-Paul Fitoussi & Francesco Saraceno, 2013. "European economic governance: the Berlin–Washington Consensus," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 37(3), pages 479-496.
    13. Arestis, Philip & Mariscal, Iris Biefang-Frisancho, 1998. "Capital shortages and asymmetries in UK unemployment," Structural Change and Economic Dynamics, Elsevier, vol. 9(2), pages 189-204, June.
    14. Michael C. Burda, 2016. "The German Labor Market Miracle, 2003 -2015: An Assessment," SFB 649 Discussion Papers SFB649DP2016-005, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
    15. Jean-Paul Fitoussi & Francesco Saraceno, 2004. "The Brussels-Frankfurt-Washington Consensus. Old and New Tradeoffs in Economics," Documents de Travail de l'OFCE 2004-02, Observatoire Francais des Conjonctures Economiques (OFCE).
    16. Alan S. Blinder, 1988. "The Fall and Rise of Keynesian Economics," The Economic Record, The Economic Society of Australia, vol. 64(4), pages 278-294, December.
    17. Paqué, Karl-Heinz, 1989. "Wage gaps, hysteresis and structural unemployment: The West German labour market in the seventies and eighties," Kiel Working Papers 358, Kiel Institute for the World Economy (IfW Kiel).
    18. Gaetano Bloise & Pietro Reichlin, 2009. "An Obtrusive Remark On Capital And Comparative Statics," Metroeconomica, Wiley Blackwell, vol. 60(1), pages 54-76, February.
    19. Marjan Petreski & Nikica Mojsoska-Blazevski, 2013. "Real Wages in the Manufacturing Industry in Macedonia: The Role of Macroeconomic Factors, with Reference to Recession Times," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 26(4), pages 113-126, January.
    20. Zwick, Thomas, 1999. "Innovations induce asymmetric employment movements," ZEW Discussion Papers 99-24, ZEW - Leibniz Centre for European Economic Research.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:revpoe:v:15:y:2003:i:1:p:33-52. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CRPE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.