DOCSLIB.ORG

Modigliani-Samuelson 1966

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Modigliani-Samuelson 1966 The Review of Economic Studies Ltd. The Pasinetti Paradox in Neoclassical and More General Models Author(s): Paul A. Samuelson and Franco Modigliani Source: The Review of Economic Studies, Vol. 33, No. 4 (Oct., 1966), pp. 269-301 Published by: The Review of Economic Studies Ltd. Stable URL: http://www.jstor.org/stable/2974425 Accessed: 22/03/2010 09:23 Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/action/showPublisher?publisherCode=resl. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. The Review of Economic Studies Ltd. is collaborating with JSTOR to digitize, preserve and extend access to The Review of Economic Studies. http://www.jstor.org The Pasinetti Paradox in Neoclassical and More General Models' I. INTRODUCTION In 1962Dr Pasinetti2 enunciateda remarkableresult. Pasinetti's Theorem: Consider a system in which the labour force grows at some exponentialrate n', technologicalprogress is Harrod-neutraland occurs at a constant rate n", and therefore the " effective" laboursupply, measured in " efficiency" units,rises at the raten = n'+ n'.' Suppose further that one can meaningfullyidentify a class of income receivers-the " capitalists"-whose sole source of income is earningsfrom capital, and suppose that this grouphas a propensityto save (averageand marginal)equal to s,. Call the remainder of the community" workers" and assumethey save the fractions, of theirwage or interest income. Then, if the systemis capableof generatinga " golden-age" growthpath along which income, consumptionand capital all grow exponentiallyat the " natural rate " n, this equilibriumgrowth path has the followingremarkable properties: 1. The steady-staterate of returnto capital or rate of interest,r*, dependsonly on the rate of growth n and on sc according to the simple formula r* = n/se; it is therefore completelyindependent of the workers'saving propensity s, or of the form of the production function. 2. The steady-statecapital output ratio (KIY)*, the capital labour ratio (K/L)* and the share of income going to capital a* = (rKIY)* are also independentof s,; again, they dependon n/sc, but also on theform of the productionfunction. From this surprisingtheorem come other remarkablecorollaries such as: if sc is unity, a situationthat Pasinettiassociates (pp. 277-278)in particularwith a socialist state -although the associationis questionable,as indicatedbelow-then it follows from (1) that r will tend to the naturalrate of growthn, and savingwill approachthe Swan-Phelps4 golden rule of accumulation S = I = P, where P = rK is total income from capital. A result of this generalityputs us all in debt to Dr Pasinetti,and is worthyof further study and elucidation,which is what we offerin this paper. 1 ,We should like to acknowledgehelful researchassistance from Felicity Skidmore,and financialaid from the Ford Foundation and the Carnegie Foundation. Helpful comments were received from the Harvard-M.I.T.mathematical economics colloquium. In' particularwe are indebted to R. Solow and G. LaMalfa for helpful criticism. 2 Luigi L. Pasinetti, " Rate of Profit and Income Distribution in Relation to the Rate of Economic Growth ", Reviewof EconomicStudies, 29 (1962), 267-279, a seminalpaper. 3 To sidestep the complicationsthat come in when KIL goes asymptoticallyto zero or infinity (when capital is incapable of being widened fast enough or slow enough), we first posit that positive labour is needed to produce positive output, and that n is positive but not too large. We remove this simplifying restrictionin the Appendix which gives an exhaustiveanalysis of possible pathologicaldivergences. 4 T. W. Swan, " Of Golden Ages and Production Functions ", presented at the Round Table on Economic Development in East Asia (InternationalEconomic Association), Gamagori, Japan, April 1960 (revised 1962), mimeo., 18 pp.; E. S. Phelps, "The Golden Rule of Accumulation", American EconomicReview, 51 (1961) 628-643; J. Robinson, " A Neoclassical Theorem", Review of Economic Studies,29 (1962), 219-226, with Commentsby R. M. Solow, P. A. Samuelson,J. E. Meade et al.; C. C. von Weizsacker,Wachstum, Zins und OptimaleInvestitionsquote (Kyklos, Verlag,Basel, 1962), 96 pp. T 269 270 REVIEW OF ECONOMIC STUDIES (a) First, we shall show the limited range of the workersand capitalistssaving co- efficientswithin which the above formulationof the PasinettiTheorem is valid. Outside that range we formulatea theoremthat is dual to it and of the same generality. It too involves a paradox, namely that the averageproduct of capital-the reciprocalof the capitaloutput ratio-to whichthe systemsettles is, this time, equalto n/sw and completely independentof the sc propensityto save out of profit or of the form of the production function. All the other golden-agevariables of the system depend only upon n/sw and on the form of the productionfunctions. The completeduality of all this with the Pasinetti theoremis notableand we state the generalcase that covers all contingencies. (b) A second, though relativelyminor purpose, is to help dispel the notion, which seemsto have been entertainedby some readers,that Pasinetti'sanalysis has some peculiar relevanceto a Kaldorianalternative theoryof distribution,of the type presentedby Kaldor in 1955, 1957, 1961, and 1962, or to some versionof a " Cambridge"theory of distribu- tion.' The following lead sentence of Pasinetti(and indeed his whole lead paragraph) might predisposethe readerin the streetto this view. " One of the most excitingresults of the macro-economictheories which have recently been elaboratedin Cambridgeis a very simple relationconnecting the rate of profit and the distributionof income to the rate of economicgrowth, through the interactionof the differentpropensities to save"9(p. 267). Otherpassages may give the impressionthat the majoraccomplishment of his analysis is to remove " a logical slip ' (p. 270) in the Kaldorianformulation which allowed for some saving by workers but did not permit these savings to accumulateand produce income.2 Actually, as Dr Pasinettimakes clear at many places (and in particularin the long footnote on p. 276) his analysisis one of the greatestgenerality. His theoremapplies in fact to any system capable of a golden-agegrowth path. But, preciselybecause of this great generality,his analysis can in no way help us to discriminatebetween alternative theories of income distribution. In order to make this point perfectlyclear, and for its own sake, our own analysisshall deal primarilywith a neoclassicalproduction function capableof smooth factor substitutionand with the case of perfectlycompetitive markets. Later we shall providesome indicationsof how the analysismight be extendedif either of these conditionsfails. (c) Finally, we shall investigate,and prove, the stabilityof the Pasinettigolden-age in the case where it is valid. That is, we shall prove that the system will asymptotically approachthe steady-statefrom arbitraryinitial conditions,at least in a local neighbour- hood of that unique state. And where our anti-Pasinettigolden age holds, in which the workers'saving propensity is all important,we demonstrateits global asymptoticstability. Our asymptoticstability analysis, which can be extendedin considerablemeasure to certain cases of fixed-proportionsand distributiontheories differentfrom that of 1 N. Kaldor, " AlternativeTheories of Distribution", Reviewof EconomicStudies, 23 (1955), 83-100 (reprintedin Essays on Valueand Distribution,pp. 228-236); " A Model of Economic Growth ", Economic Journal,67 (1957), 591-624 (reprintedin Essays in EconomicStability and Growth,pp. 256-300); F. Lutz and D. C. Hague (eds.), The Theoryof Capital(1961), pp. 177-220,from the 1958 CorfuI.E.A. Conference; with J. A. Mirrlees," A New Model of EconomicGrowth," Review of EconomicStudies, 29 (1962), 174-192. Cambridgewritings related to Kaldorism,but not necessarilyidentical with it, are J. Robinson, Accumulation of Capital (1956) and Collected EconomicPapers, 2 (1960), particularlypp. 145-158, " The Theory of Distribution"; Exercisesin EconomicAnalysis (Macmillan, London, 1960),Essays in the Theoryof Economic Growth(Macmillan, London, 1962); D. G. Champernowne," CapitalAccumulation and the Maintenance of Full Employment", EconomicJournal, 67 (1958), 211-244; R. F. Kahn, " Exercisesin the Analysis of Growth ", OxfordEconomic Papers, New Series, 10 (1958), 143-156. 2 Actually, it might be argued that there need not be a " logical slip " in the Kaldorian model, if it will merely assume that the propensity to save out of income from capital is s, whether that income is received by capitalists
Load more

Recommended publications
  • Economic Thinking in an Age of Shared Prosperity
    BOOKREVIEW Economic Thinking in an Age of Shared Prosperity GRAND PURSUIT: THE STORY OF ECONOMIC GENIUS workingman’s living standards signaled the demise of the BY SYLVIA NASAR iron law and forced economists to recognize and explain the NEW YORK: SIMON & SCHUSTER, 2011, 558 PAGES phenomenon. Britain’s Alfred Marshall, popularizer of the microeconomic demand and supply curves still used today, REVIEWED BY THOMAS M. HUMPHREY was among the first to do so. He argued that competition among firms, together with their need to match their rivals’ distinctive feature of the modern capitalist cost cuts to survive, incessantly drives them to improve economy is its capacity to deliver sustainable, ever- productivity and to bid for now more productive and A rising living standards to all social classes, not just efficient workers. Such bidding raises real wages, allowing to a fortunate few. How does it do it, especially in the face labor to share with management and capital in the produc- of occasional panics, bubbles, booms, busts, inflations, tivity gains. deflations, wars, and other shocks that threaten to derail Marshall interpreted productivity gains as the accumula- shared rising prosperity? What are the mechanisms tion over time of relentless and continuous innumerable involved? Can they be improved by policy intervention? small improvements to final products and production Has the process any limits? processes. Joseph Schumpeter, who never saw an economy The history of economic thought is replete with that couldn’t be energized through unregulated credit- attempts to answer these questions. First came the pes- financed entrepreneurship, saw productivity gains as simists Thomas Malthus, David Ricardo, James Mill, and his emanating from radical, dramatic, transformative, discon- son John Stuart Mill who, on grounds that for millennia tinuous innovations that precipitate business cycles and wages had flatlined at near-starvation levels, denied that destroy old technologies, firms, and markets even as they universally shared progress was possible.
    [Show full text]
  • After the Phillips Curve: Persistence of High Inflation and High Unemployment
    Conference Series No. 19 BAILY BOSWORTH FAIR FRIEDMAN HELLIWELL KLEIN LUCAS-SARGENT MC NEES MODIGLIANI MOORE MORRIS POOLE SOLOW WACHTER-WACHTER % FEDERAL RESERVE BANK OF BOSTON AFTER THE PHILLIPS CURVE: PERSISTENCE OF HIGH INFLATION AND HIGH UNEMPLOYMENT Proceedings of a Conference Held at Edgartown, Massachusetts June 1978 Sponsored by THE FEDERAL RESERVE BANK OF BOSTON THE FEDERAL RESERVE BANK OF BOSTON CONFERENCE SERIES NO. 1 CONTROLLING MONETARY AGGREGATES JUNE, 1969 NO. 2 THE INTERNATIONAL ADJUSTMENT MECHANISM OCTOBER, 1969 NO. 3 FINANCING STATE and LOCAL GOVERNMENTS in the SEVENTIES JUNE, 1970 NO. 4 HOUSING and MONETARY POLICY OCTOBER, 1970 NO. 5 CONSUMER SPENDING and MONETARY POLICY: THE LINKAGES JUNE, 1971 NO. 6 CANADIAN-UNITED STATES FINANCIAL RELATIONSHIPS SEPTEMBER, 1971 NO. 7 FINANCING PUBLIC SCHOOLS JANUARY, 1972 NO. 8 POLICIES for a MORE COMPETITIVE FINANCIAL SYSTEM JUNE, 1972 NO. 9 CONTROLLING MONETARY AGGREGATES II: the IMPLEMENTATION SEPTEMBER, 1972 NO. 10 ISSUES .in FEDERAL DEBT MANAGEMENT JUNE 1973 NO. 11 CREDIT ALLOCATION TECHNIQUES and MONETARY POLICY SEPBEMBER 1973 NO. 12 INTERNATIONAL ASPECTS of STABILIZATION POLICIES JUNE 1974 NO. 13 THE ECONOMICS of a NATIONAL ELECTRONIC FUNDS TRANSFER SYSTEM OCTOBER 1974 NO. 14 NEW MORTGAGE DESIGNS for an INFLATIONARY ENVIRONMENT JANUARY 1975 NO. 15 NEW ENGLAND and the ENERGY CRISIS OCTOBER 1975 NO. 16 FUNDING PENSIONS: ISSUES and IMPLICATIONS for FINANCIAL MARKETS OCTOBER 1976 NO. 17 MINORITY BUSINESS DEVELOPMENT NOVEMBER, 1976 NO. 18 KEY ISSUES in INTERNATIONAL BANKING OCTOBER, 1977 CONTENTS Opening Remarks FRANK E. MORRIS 7 I. Documenting the Problem 9 Diagnosing the Problem of Inflation and Unemployment in the Western World GEOFFREY H.
    [Show full text]
  • An Interview with Franco Modigliani
    THE UNIVERSITY OF KANSAS WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS AN INTERVIEW WITH FRANCO MODIGLIANI Interviewed by William A. Barnett University of Kansas Robert Solow MIT THE UNIVERSITY OF KANSAS WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS WORKING PAPER NUMBER 200407 Macroeconomic Dynamics, 4, 2000, 222–256. Printed in the United States of America. MD INTERVIEW AN INTERVIEW WITH FRANCO MODIGLIANI Interviewed by William A. Barnett Washington University in St. Louis and Robert Solow Massachusetts Institute of Technology November 5–6, 1999 Franco Modigliani’s contributions in economics and finance have transformed both fields. Although many other major contributions in those fields have come and gone, Modigliani’s contributions seem to grow in importance with time. His famous 1944 article on liquidity preference has not only remained required reading for generations of Keynesian economists but has become part of the vocabulary of all economists. The implications of the life-cycle hypothesis of consumption and saving provided the primary motivation for the incorporation of finite lifetime models into macroeconomics and had a seminal role in the growth in macroeconomics of the overlapping generations approach to modeling of Allais, Samuelson, and Diamond. Modigliani and Miller’s work on the cost of capital transformed corporate finance and deeply influenced subsequent research on investment, capital asset pricing, and recent research on derivatives. Modigliani received the Nobel Memorial Prize for Economics in 1985. In macroeconomic policy, Modigliani has remained influential on two continents. In the United States, he played a central role in the creation of a the Federal Re- serve System’s large-scale quarterly macroeconometric model, and he frequently participated in the semiannual meetings of academic consultants to the Board of Governors of the Federal Reserve System in Washington, D.C.
    [Show full text]
  • Chapter 3 the Basic OLG Model: Diamond
    Chapter 3 The basic OLG model: Diamond There exists two main analytical frameworks for analyzing the basic intertem- poral choice, consumption versus saving, and the dynamic implications of this choice: overlapping-generations (OLG) models and representative agent models. In the first type of models the focus is on (a) the interaction between different generations alive at the same time, and (b) the never-ending entrance of new generations and thereby new decision makers. In the second type of models the household sector is modelled as consisting of a finite number of infinitely-lived dynasties. One interpretation is that the parents take the utility of their descen- dants into account by leaving bequests and so on forward through a chain of intergenerational links. This approach, which is also called the Ramsey approach (after the British mathematician and economist Frank Ramsey, 1903-1930), will be described in Chapter 8 (discrete time) and Chapter 10 (continuous time). In the present chapter we introduce the OLG approach which has shown its usefulness for analysis of many issues such as: public debt, taxation of capital income, financing of social security (pensions), design of educational systems, non-neutrality of money, and the possibility of speculative bubbles. We will focus on what is known as Diamond’sOLG model1 after the American economist and Nobel Prize laureate Peter A. Diamond (1940-). Among the strengths of the model are: The life-cycle aspect of human behavior is taken into account. Although the • economy is infinitely-lived, the individual agents are not. During lifetime one’s educational level, working capacity, income, and needs change and this is reflected in the individual labor supply and saving behavior.
    [Show full text]
  • ΒΙΒΛΙΟΓ ΡΑΦΙΑ Bibliography
    Τεύχος 53, Οκτώβριος-Δεκέμβριος 2019 | Issue 53, October-December 2019 ΒΙΒΛΙΟΓ ΡΑΦΙΑ Bibliography Βραβείο Νόμπελ στην Οικονομική Επιστήμη Nobel Prize in Economics Τα τεύχη δημοσιεύονται στον ιστοχώρο της All issues are published online at the Bank’s website Τράπεζας: address: https://www.bankofgreece.gr/trapeza/kepoe https://www.bankofgreece.gr/en/the- t/h-vivliothhkh-ths-tte/e-ekdoseis-kai- bank/culture/library/e-publications-and- anakoinwseis announcements Τράπεζα της Ελλάδος. Κέντρο Πολιτισμού, Bank of Greece. Centre for Culture, Research and Έρευνας και Τεκμηρίωσης, Τμήμα Documentation, Library Section Βιβλιοθήκης Ελ. Βενιζέλου 21, 102 50 Αθήνα, 21 El. Venizelos Ave., 102 50 Athens, [email protected] Τηλ. 210-3202446, [email protected], Tel. +30-210-3202446, 3202396, 3203129 3202396, 3203129 Βιβλιογραφία, τεύχος 53, Οκτ.-Δεκ. 2019, Bibliography, issue 53, Oct.-Dec. 2019, Nobel Prize Βραβείο Νόμπελ στην Οικονομική Επιστήμη in Economics Συντελεστές: Α. Ναδάλη, Ε. Σεμερτζάκη, Γ. Contributors: A. Nadali, E. Semertzaki, G. Tsouri Τσούρη Βιβλιογραφία, αρ.53 (Οκτ.-Δεκ. 2019), Βραβείο Nobel στην Οικονομική Επιστήμη 1 Bibliography, no. 53, (Oct.-Dec. 2019), Nobel Prize in Economics Πίνακας περιεχομένων Εισαγωγή / Introduction 6 2019: Abhijit Banerjee, Esther Duflo and Michael Kremer 7 Μονογραφίες / Monographs ................................................................................................... 7 Δοκίμια Εργασίας / Working papers ......................................................................................
    [Show full text]
  • The Nobel Prize in Economics: Behind the Aura
    Review Essay The Nobel Prize in Economics: Behind the Aura Sanjay G. Reddy Avner Offer and Gabriel Soderberg,¨ The Nobel Factor: The Prize in Economics, Social Democracy, and the Market Turn, 2016. Princeton, NJ: Princeton University Press. 400 pp. £18.74 hardcover. In The Nobel Factor, Avner Offer and Gabriel Soderberg¨ help us to un- derstand the politics behind the awarding of what is colloquially known as the Nobel Prize in Economics (and more correctly as the Swedish Central Bank Prize in Honour of Alfred Nobel). The main idea of the book is that the Prize has been often awarded to market-oriented thinkers with the aim of undermining social democracy, of which Sweden was the most famous exemplar, in favour of market principles. This rather local agenda, pressed by the influential economist Assar Lindbeck (and presumably by others, although they receive less attention in the book) was, the authors argue, cru- cial to explaining the pattern of awards. The authors go so far as to contrast Economics with Social Democracy, in the process identifying the discipline as a whole with its most market-oriented strand. The authors recognize that there were other elements within modern economics, but argue that the ‘high theory’ of neoclassical economics, interpreted as making the case for the op- timality of markets, was greatly bolstered by the prize, especially after its first decade (when social democratic stalwarts such as Gunnar Myrdal won it.). The preponderance of University of Chicago faculty members among winners in the later period is one indication of this tendency, although the presence of exceptions even in the later years (notably Amartya Sen) is ac- knowledged (pp.
    [Show full text]
  • Econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible
    A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Biddle, Jeff E. Working Paper The Genealogy of the Labor Hoarding Concept CHOPE Working Paper, No. 2014-13 Provided in Cooperation with: Center for the History of Political Economy at Duke University Suggested Citation: Biddle, Jeff E. (2014) : The Genealogy of the Labor Hoarding Concept, CHOPE Working Paper, No. 2014-13, Duke University, Center for the History of Political Economy (CHOPE), Durham, NC This Version is available at: http://hdl.handle.net/10419/149725 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu The Genealogy of the Labor Hoarding Concept by Jeff E. Biddle CHOPE Working Paper No. 2014-13 April 2014 The Genealogy of the Labor Hoarding Concept Jeff E.
    [Show full text]
  • The Time Series Consumption Function Revisited
    ALAN S. BLINDER Brookings Institution and Princeton University ANGUS DEATON Princeton University The Time Series Consumption Function Revisited THERELATIONSHIP between consumer spending and income is one of the oldest statistical regularitiesof macroeconomics-and one of the stur- diest. Like the aging movie star, it needs a little touching up now and again, but always seems to come bouncingback. A dozen yearsago, boththe theoreticalderivation and the econometric form of the aggregateconsumption function were considered settled. Most economists adheredto one of two ways of puttingFisher's theory of intertemporaloptimization into operation: Milton Friedman's per- manent income hypothesis (henceforth, PIH) or Franco Modigliani's life-cycle hypothesis (henceforth,LCH). ' Since each variantseemed to have sound theoretical underpinnings,and since the two had similar econometricforms that explainedthe data well and had similarimplica- tions for policy, there was not a greatdeal to quarrelabout. Perhapsthe most contentious empirical issue was the apparently large marginal This paperhas benefitedfrom the commentsand suggestionsof AlbertAndo, Whitney Newey, and members of the Brookings Panel and from seminar presentationsat the Universityof Warwick,Princeton University, and Johns Hopkins University.We thank Peter Rathjensand Lori Gruninfor researchassistance and the National Science Foun- dationfor financialsupport. 1. Milton Friedman, A Theory of the Consumption Function (Princeton University Press, 1957); Franco Modigliani and Richard Brumberg,
    [Show full text]
  • "Rethinking Pension Reform: Ten Myths About Social Security Systems"
    "Rethinking Pension Reform: Ten Myths About Social Security Systems" Peter R. Orszag (Sebago Associates, Inc.) Joseph E. Stiglitz (The World Bank) Presented at the conference on "New Ideas About Old Age Security" The World Bank Washington, D.C. September 14-15, 1999 1 EXECUTIVE SUMMARY In 1994, the World Bank published a seminal book on pension reform, entitled Averting the Old Age Crisis. The book noted that "myths abound in discussions of old age security."1 This paper, prepared for a World Bank conference that will revisit pension reform issues five years after the publication of Averting the Old Age Crisis, examines ten such myths in a deliberately provocative manner. The problems that have motivated pension reform across the globe are real, and reforms are needed. In principle, the approach delineated in Averting the Old Age Crisis is expansive enough to reflect any potential combination of policy responses to the pension reform challenge. But in practice, the "World Bank model" has been interpreted as involving one specific constellation of pension pillars: a publicly managed, pay-as- you-go, defined benefit pillar; a privately managed, mandatory, defined contribution pillar; and a voluntary private pillar. It is precisely the private, mandatory, defined contribution component that we wish to explore in this paper. The ten myths examined in the paper include: Macroeconomic myths • Myth #1: Individual accounts raise national saving • Myth #2: Rates of return are higher under individual accounts • Myth #3: Declining rates of return
    [Show full text]
  • Macroeconomic Dynamics at the Cowles Commission from the 1930S to the 1950S
    Yale University EliScholar – A Digital Platform for Scholarly Publishing at Yale Cowles Foundation Discussion Papers Cowles Foundation 9-1-2019 Macroeconomic Dynamics at the Cowles Commission from the 1930s to the 1950s Robert W. Dimand Follow this and additional works at: https://elischolar.library.yale.edu/cowles-discussion-paper-series Part of the Economics Commons Recommended Citation Dimand, Robert W., "Macroeconomic Dynamics at the Cowles Commission from the 1930s to the 1950s" (2019). Cowles Foundation Discussion Papers. 56. https://elischolar.library.yale.edu/cowles-discussion-paper-series/56 This Discussion Paper is brought to you for free and open access by the Cowles Foundation at EliScholar – A Digital Platform for Scholarly Publishing at Yale. It has been accepted for inclusion in Cowles Foundation Discussion Papers by an authorized administrator of EliScholar – A Digital Platform for Scholarly Publishing at Yale. For more information, please contact [email protected]. MACROECONOMIC DYNAMICS AT THE COWLES COMMISSION FROM THE 1930S TO THE 1950S By Robert W. Dimand May 2019 COWLES FOUNDATION DISCUSSION PAPER NO. 2195 COWLES FOUNDATION FOR RESEARCH IN ECONOMICS YALE UNIVERSITY Box 208281 New Haven, Connecticut 06520-8281 http://cowles.yale.edu/ Macroeconomic Dynamics at the Cowles Commission from the 1930s to the 1950s Robert W. Dimand Department of Economics Brock University 1812 Sir Isaac Brock Way St. Catharines, Ontario L2S 3A1 Canada Telephone: 1-905-688-5550 x. 3125 Fax: 1-905-688-6388 E-mail: [email protected] Keywords: macroeconomic dynamics, Cowles Commission, business cycles, Lawrence R. Klein, Tjalling C. Koopmans Abstract: This paper explores the development of dynamic modelling of macroeconomic fluctuations at the Cowles Commission from Roos, Dynamic Economics (Cowles Monograph No.
    [Show full text]
  • Understanding Robert Lucas (1967-1981): His Influence and Influences
    A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Andrada, Alexandre F.S. Article Understanding Robert Lucas (1967-1981): his influence and influences EconomiA Provided in Cooperation with: The Brazilian Association of Postgraduate Programs in Economics (ANPEC), Rio de Janeiro Suggested Citation: Andrada, Alexandre F.S. (2017) : Understanding Robert Lucas (1967-1981): his influence and influences, EconomiA, ISSN 1517-7580, Elsevier, Amsterdam, Vol. 18, Iss. 2, pp. 212-228, http://dx.doi.org/10.1016/j.econ.2016.09.001 This Version is available at: http://hdl.handle.net/10419/179646 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc-nd/4.0/ www.econstor.eu HOSTED BY Available online at www.sciencedirect.com ScienceDirect EconomiA 18 (2017) 212–228 Understanding Robert Lucas (1967-1981): his influence ଝ and influences Alexandre F.S.
    [Show full text]
  • Inside the Economist's Mind: the History of Modern
    1 Inside the Economist’s Mind: The History of Modern Economic Thought, as Explained by Those Who Produced It Paul A. Samuelson and William A. Barnett (eds.) CONTENTS Foreword: Reflections on How Biographies of Individual Scholars Can Relate to a Science’s Biography Paul A. Samuelson Preface: An Overview of the Objectives and Contents of the Volume William A. Barnett History of Thought Introduction: Economists Talking with Economists, An Historian’s Perspective E. Roy Weintraub INTERVIEWS Chapter 1 An Interview with Wassily Leontief Interviewed by Duncan K. Foley Chapter 2 An Interview with David Cass Interviewed jointly by Steven E. Spear and Randall Wright Chapter 3 An Interview with Robert E. Lucas, Jr. Interviewed by Bennett T. McCallum Chapter 4 An Interview with Janos Kornai Interviewed by Olivier Blanchard Chapter 5 An Interview with Franco Modigliani Interviewed by William A. Barnett and Robert Solow Chapter 6 An Interview with Milton Friedman Interviewed by John B. Taylor Chapter 7 An Interview with Paul A. Samuelson Interviewed by William A. Barnett Chapter 8 An Interview with Paul A. Volcker Interviewed by Perry Mehrling 2 Chapter 9 An Interview with Martin Feldstein Interviewed by James M. Poterba Chapter 10 An Interview with Christopher A. Sims Interviewed by Lars Peter Hansen Chapter 11 An Interview with Robert J. Shiller Interviewed by John Y. Campbell Chapter 12 An Interview with Stanley Fischer Interviewed by Olivier Blanchard Chapter 13 From Uncertainty to Macroeconomics and Back: An Interview with Jacques Drèze Interviewed by Pierre Dehez and Omar Licandro Chapter 14 An Interview with Tom J. Sargent Interviewed by George W.
    [Show full text]