Elgar original reference
Edited by Mark Setterfield
An Introduction to Alternative Theories of Economic Growth
Mark Setterfield It has become commonplace for leading textbooks on growth theory to characterize the historical development of the subject as a simple progression from first- to secondgeneration neoclassical growth theory, punctuated only by a brief hiatus during the 1970s when inflation became the cause célèbre of macrodynamics (for representative examples, see Barro and Sala-i-Martin, 1995; Jones, 2002; Aghion and Howitt, 2009). But as has been remarked elsewhere (Setterfield, 2002, 2003), these “stylized facts” are more apparent than real. They conceal a rich history of alternative theories of economic growth, that both parallels and interacts with the development of neoclassical theory. The purpose of this Handbook is to provide a comprehensive overview of these alternative theories – one that both surveys major sub-fields of alternative theories of economic growth (including, but not limited to, Classical, Kaleckian, Evolutionary, and Kaldorian growth theories) and draws attention to frontier issues in the field. The ambition of this introduction is to orient the reader towards the content that follows. 1 Common themes in alternative theories of economic growth Economic theories that depart from one or more of the “hard core” presuppositions of neoclassical economics (such as optimizing behaviour by decision makers, or the marginal productivity theory of value and distribution) are often said to be defined chiefly in terms of their opposition to neoclassical theory – that is, in terms of what they are not. As is obvious from what has already been said above, it is tempting to lapse into the same habit...