Final considerations

This final Chapter summarizes the results obtained and illustrates the challenges that remain to be faced. Within a methodological framework characterized by the interplay between real and monetary aspects, the complex dynamic relation between income distribution, growth and unemployment has been examined in successive steps. The main task of the book has been double. On one hand, it has tried to broaden the analysis of the so called canonical growth cycle models, while on the other it has struggled to change the concept of growth which is conceived as a series of adjustments processes within a medium-run perspective. The first task has been achieved by presenting a workhorse model of the Minsky- Harrod variety where the distributive loop in inserted into a context where monetary and real aspects interact , aggregate supply is endogenous and unemployment has a strategic role both on supply and demand, where it acts through an inequality channel. The second task has been to insert the analysis into a medium-run perspective where growth is analyzed by a regime-switching technique. In this case, not only bounded and persistent fluctuations are generated, but history and disequilibrium matter and enter into the analysis. The analysis has suggested two conclusions. On one hand, it offers a justification to the existence of a variety of results obtained in the empirical analysis. On the other, the study of the distributive loop in a dynamic context prone to instability oblige to study the role of thwarting forces that prevent the existence of runaway situations. It is this intricate interplay of economic and institutional forces that highlights the political economy nature of the topic and that indicates the future challenges to be faced.