Read a bit more of the book then Rakesh--and maybe also look at my paper on
my Marx-Goodwin-Minsky model of the trade cycle at:
http://www.csu.edu.au/ci/vol06/keen/keen.html
Cheers,
Steve
At 05:37 AM 22/03/2002 Friday, you wrote:
>re 6798
>
>>
>>Within the Keynesian system the demand for investment goods does not
>>derive from the demand for consumption goods. Rather both investment
>>demand and labor demand are derived demands dependent on the level of
>>*aggregate* demand.
>>
>>In solidarity, Jerry
>
>
>
>What then determines the level of aggregate demand? I think Steve
>implicitly presents in his interpretation of the Keynesian system the idea
>that it is determined by the prospects of final consumption.
>
>As a side note, Bush/Greenspan are attempting to bolster investment
>demand not so much by strenghtening final demand via direct military
>purchases and easy consumer credit (which in the US has led to common
>complaint by progressive economists that the Republicans are more
>Keynesian than the Democrats) but rather by brightening the prospects of
>long term profitability through, for example, lax anti trust law, union
>busting activity by the National Labor Relations Board, and regressive
>tax cuts that will require much deeper slashes in the social wage than to
>which Bush and Greenspan are admitting.
>
>Krugman has railed against the massive regressive tax cuts because of the
>pressure presumably put on the long bond by the prospect of huge future
>federal government deficits, not because of how such cuts in the social
>wage by dimming the prospects of future demand for consumption goods
>reduce demand for investment goods in the present.
>
>Bush is in fact attempting to ensure that direct and social wages will not
>keep pace with productivity gains in his attempt to revive investment demand.
>
>Steve's Keynes seems to be an underconsumptionist but underconsumptionism
>fails to explain the downturn in investment demand--there had been no
>prior problem in the realization of surplus value--and more importantly
>the steps that are taken to revive investment demand.
>
>Rakesh
>
Home Page: http://www.debunking-economics.com
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Dr. Steve Keen
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