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Post-Keynesian Economics Marc Lavoie, University of Ottawa

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Post-Keynesian Economics Marc Lavoie, University of Ottawa YSI Workshop Paris @ 2015 Annual Conference Paris, France April 6-8, 2015 Course Description Post-Keynesian Economics Marc Lavoie, University of Ottawa Lecture 1: Essentials of heterodox and post-Keynesian economics This will be a discussion about the features that post-Keynesian economics (PKE) shares with the other heterodox schools of thought, the specific contributions of PKE, and the various strands of PKE. There will also be a discussion about why students should not be intimated by the apparent empirical success of neoclassical economics. Lecture 2: Post-Keynesian microeconomics of the firm This lecture will deal with the goals of firms and the role of competition as seen by post-Keynesian authors, the shape of cost curves (the rejection of U-shaped cost curves), pricing theories and the determinants of costing margins, as well as the impact of variations in demand on actual profit margins. Lecture 3: Endogenous credit and money Ever since the 1950s post-Keynesians have argued that economies were credit-driven and that the money supply and the supply of high-powered are endogenous. The lecture will draw some implications for the current situation: the excess reserves of banks, quantitative easing, functional finance, the shadow banking system and the fragility of the banking system, forward exchange markets, the large reserves of periphery central banks, the Mundell-Fleming model. Lecture 4: The labour ‘market’ This lecture will be devoted to the alternative view of the labour market that post-Keynesians have developed over the years, which is based on effective demand and the importance of income distribution, which leads to the consideration of an upward-sloping demand curve for labour. Lecture 5: Wage-led growth This will be a discussion of the workhorse growth model in post-Keynesian circles, the Kaleckian model of growth and distribution. The main features of its canonical version will be recalled, some of its drawbacks will be noted and the empirical results achieved with its post-Kaleckian variant, with possible wage-led and profit-led cases, will be discussed. 1 Mandatory reading The lectures will be essentially based on my new book: Marc Lavoie, Post-Keynesian Economics: New Foundations (Edward Elgar, 2014). An alternative can be the simpler book, Marc Lavoie, Introduction to Post-Keynesian Economics (Palgrave Macmillan). Supplementary readings Lecture 1: Setterfield, M. (2003), ‘What is analytical political economy?’, International Journal of Political Economy, 33 (2), Summer, 4-16. Dutt, A.K. (2003), ‘On Post Walrasian economics, macroeconomic policy and heterodox economics’, International Journal of Political Economy, 33 (2), Summer, 47-64. Stanley, T.D. (2013), ‘Does economics add up? An introduction to ceta-regression analysis’, European Journal of Economics and Economic Policies: Intervention, 10 (20, 207-220. Lecture 2: Coutts, K. and N. Norman (2013), ‘Post-Keynesian approaches to industrial pricing: a survey and critique’, in G.C. Harcourt and P. Kriesler (eds), Oxford Handbook of Post-Keynesian Economics, volume 1, Oxford: Oxford University Press, pp. 443-466. Lee, F.S., J. Irving-Lessman, P. Earl and J.E. Davies (1986), ‘P.W.S. Andrews’ theory of competitive oligopoly: a new interpretation’, British Review of Economic Issues, 8 (19), Autumn, 13-39. Lecture 3: Fullwiler, S. (2013), ‘An endogenous money perspective on the post-crisis monetary policy debate’, Review of Keynesian Economics, 1 (2), Summer, 171-194. Lavoie, M. (2000), ‘A Post Keynesian view of interest parity theorems’, Journal of Post Keynesian Economics, 23 (1), Fall, 163-179. Moosa, I.A., (2004), ‘An empirical examination of the Post Keynesian view of forward exchange rates’, Journal of Post Keynesian Economics, 26 (3), Spring, 395-418. Lecture 4: Lavoie, M. (1996-97), ‘Real wages, employment structure and the aggregate demand curve in a Kaleckian short-run model’, Journal of Post Keynesian Economics, 19 (2), Winter, 275-288. Lavoie, M. (2003), ‘Real wages and unemployment with effective and notional demand for labour’, Review of Radical Political Economics, 35 (2), June, 166-182. Lecture 5: Hein, E., M. Lavoie, and T. Van Treeck (2011), ‘Some instability puzzles in Kaleckian models of growth and distribution: a critical survey’, Cambridge Journal of Economics, 35 (1), May, 587-612. Onaran, Ö. and G. Galanis (2012). ‘Is aggregate demand wage-led or profit-led: national and global effects’, working paper # 40, Conditions of Work and Employment Series, International Labour Office. http://www.ilo.org/wcmsp5/groups/public/---ed_protect/---protrav/--- travail/documents/publication/wcms_192121.pdf 2 .
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