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Building blocks of a heterodox business cycle theory

Building blocks of a heterodox business cycle theory

Calvert Jump, Robert ORCID: 0000-0002-2967-512X and Stockhammer, Engelbert (2023) Building blocks of a heterodox business cycle theory. Journal of Post Keynesian Economics, 46 (2). pp. 334-358. ISSN 0160-3477 (Print), 1557-7821 (Online) (doi:

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A key characteristic of heterodox theories of the business cycle is their focus on endogenous business cycle mechanisms. This paper provides an overview and comparison of four models in heterodox business cycle theory: multiplier-accelerator models, Goodwin models, Minskyan debt-cycle models, and momentum trader models. A representative model from each theory is formulated as a two-dimensional predator-prey system in continuous time, which allows us to identify the different stabilising and destabilising mechanisms. We argue that the theories are substantially competing, as they posit different mechanisms that explain cycles, but we also argue that these mechanisms are not mutually exclusive. We suggest that heterodox economists work towards a synthesis.

Item Type: Article
Uncontrolled Keywords: business cycles; endogenous cycles; crises
Subjects: H Social Sciences > HB Economic Theory
Faculty / School / Research Centre / Research Group: Faculty of Business
Faculty of Business > Department of Accounting & Finance
Faculty of Business > Institute of Political Economy, Governance, Finance and Accountability (IPEGFA)
Last Modified: 06 Jul 2023 10:16

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