A lecture with Prof. Amit Bhaduri and Prof. Kazimierz Łaski on: What remains of the theories of Kalecki and Keynes?
What remains of the theories of Kalecki and Keynes?
1.Both Keynes and Kalecki set their theories in the context of a closed economy. This was a self conscious decision (as Kalecki’s colleague Josef Steindl used to remind us) to shift the emphasis from foreign(e.g. competitive ‘beggar my neighbor’ exchange rate policies of inter-war years)to domestic economic policies. The context seems dramatically different today with the emphasis reversed. So does it mean that The theories of Kaleki and Keynes have lost their relevance in a globalized world?
2. The inter-war trade rivalry of a vicious kind has largely receded through common currency areas, regional trade agreements etc but domestic policies are certainly more problematic today on several counts, like fear of capital flight (less important in a single currency area)and dependence on capital flows rather than on exchange rate for adjustment of balance of payments. It means in turn a shift of attention from the current to the capital account. It also means monetary rather than fiscal policy gets greater importance. Although all this is arguable in theory, in practice their impact is less certain because the unknown variable is capital gains and losses often exert a decisive influence on international capital flows. I would argue this has given old fashioned Keynesian theoretical understanding but not the actual policies a new relevance in at least three different ways.
(a) Sustaining capital gains in the asset and real estate market becomes an important way of maintaining effective demand. Since capital gains cannot be realized on a macro scale without bursting the bubble, borrowing against rising asset price becomes the mechanism of a debt driven boom for demand management( the essence of the model of ‘great moderation’).
(b) The need to raise the attractiveness of financial rather than real investment to sustain asset price rise is achieved through fiscal policy induced inequality and, focusing obsessively on international competitiveness and unit cost reduction through productivity growth at the cost of the volume of employment, competitive tax benefits to large corporations and wage restraint. These policies reduce aggregate domestic demand which is countered by debt driven consumption boom( note Keynesian theory about the importance of aggregate demand remains, but is used to serve a different interest group).
(c) Finally, such debt driven policies requires the abundance of ‘near-monies’ to meet demand, and are easy to create through devices like privately agreed insurance and other debt arrangements( over-the counter derivatives, CDOs, debt-swaps are quantitatively important examples) when the economic outlook is optimistic. This ’endogenously’ created credit expansion in which private arrangements regarding credit and debt repayment without many of the central bank regulations but also without a lender of last resort provision increases rapidly, somewhat like the catalyst of in an explosive chemical reaction in which the catalyst reproduces itself on an increasing scale during the reaction. But the when even a small fraction of default obligation on the expanding volume of such debt has to be met with generally accepted liquidity guaranteed by the central bank, this inverted pyramid like structure of privately created debt with little liquidity support at the base collapses easily and suddenly. The financial melt-down is not a debt cycle caused by the prudence of banks restraining credit beyond a sustainable level, but rather by the imprudence of banks in expanding private credit inverted pyramid like structure.
3.The tragedy of our time is not that the theories of Keynes and Kalecki emphasizing the role of aggregate demand in maintaining high level of domestic economic activity has been forgotten, but they are being remembered in a perverse way through the asset market the catalyst of to serve the narrow interest of the financial sector, and that too in a way that turns out to be unsustainable both for the financial and the real economy.
Koreferat pt. The financial balance of the private sector and of the foreign sector wygłosi prof. Kazimierz Łaski. Dyskusję po wykładzie poprowadzi prof. Jerzy Osiatyński.
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prof. Amit Bhaduri – ekonomista indyjski, obecnie profesor emerytowany uniwersytetu im. Jawaharlala Nehru w Delhi, wcześniej wykładowca m.in. Delhi School of Economics, a także Pembroke College Uniwersytetu Cambridge, Uniwersytetu Wiedeńskiego i Uniwersytetu w Linzu; stypendysta berlińskiego Wissenschaftskolleg, a także ekonomista Organizacji NZ ds. Rozwoju Przemysłowego. W swej pracy zajmował się początkowo problematyką struktury gospodarczej zacofanych krajów rolniczych, a także teoretycznymi problemami roli kapitału w kształtowaniu wzrostu gospodarczego; obecnie zajmuje się analizą polityki gospodarczej i rozwoju w warunkach globalizacji. Autor m.in. książek: Growth, Distribution and Innovations: Understanding their Interrelations (The Graz Schumpeter Lectures) (2007) oraz The Face You Were Afraid to See: Essays On the Indian Economy (2009). Jego wykład poświęcony będzie implikacjom teorii Keynesa i Kaleckiego dla polityki gospodarczej w warunkach globalizacji.
Kooreferat do wykładu wygłosi prof. Kazimierz Łaski – profesor nauk ekonomicznych, absolwent warszawskiej SGPiS, uczeń Michała Kaleckiego, w latach 1969–71 pracownik wiedeńskiego Instytutu Badań Ekonomicznych (WIFO), a później wieloletni profesor Uniwersytetu im. Johannesa Keplera w Linzu, obecnie konsultant naukowy w Wiedeńskim Instytucie Międzynarodowych Studiów Ekonomicznych. Znawca problematyki makroekonomicznej (zwłaszcza teorii post-Keynesowskiej), polityki fiskalnej oraz kwestii transformacji ekonomicznej krajów postsocjalistycznych. Autor m. in. książek From Marx to the Market: Socialism in Search for an Economic System (1990, wspólnie w Włodzimierzem Brusem, wyd. polskie Od Marksa do rynku, 1992) oraz Mity i rzeczywistość w polityce gospodarczej i w nauczaniu ekonomii (2009).
