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A non-linear post-Keynesian Goodwin-type endogenous model of the cycle for the USA

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  • Konstantakis, Konstantinos N.
  • Michaelides, Panayotis G.
  • Mariolis, Theodore

Abstract

Since its original formulation, Goodwin’s (1967) approach became a standard endogenous business cycles model. However, despite its elegant mathematical formulation, the empirical estimation of Goodwin-type models has not always ended up in success. The present paper uses the so-called Bhaduri-Marglin accumulation function in Goodwin’s original growth cycle model. Based on its derived equations of motion and dynamic properties, we econometrically estimate the proposed model for the case of the US economy in the time period 1960-2012, using structural breaks. The empirical estimation is very satisfactory and, in general terms, consistent with economic theory and the findings by other researchers on the US economy. The results of this work suggest that the proposed approach is an appropriate vehicle for expanding and improving traditional Goodwin-type models.

Suggested Citation

  • Konstantakis, Konstantinos N. & Michaelides, Panayotis G. & Mariolis, Theodore, 2018. "A non-linear post-Keynesian Goodwin-type endogenous model of the cycle for the USA," MPRA Paper 90036, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:90036
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    More about this item

    Keywords

    Bhaduri-Marglin accumulation function; Goodwin type models; US economy JEL classification:;
    All these keywords.

    JEL classification:

    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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