Review of Keynesian Economics

Time scales and mechanisms of economic cycles: a review of theories of long waves*

Lucas Bernard * and Aleksandr V. Gevorkyan * and Thomas I. Palley * and Willi Semmler *

Keywords: cycles, production cycles, infrastructure cycles, accelerator-multiplier mechanism, innovation cycles, financial crisis, booms and busts, Goodwin, Kalecki, Minsky, asset price-leveraging cycles, Kaldor, Kuznets, Kondratieff


This paper explores long wave theory, including Kondratieff's theory of cycles in production and relative prices; Kuznets's theory of cycles arising from infrastructure investments; Schumpeter's theory of cycles due to waves of technological innovation; Goodwin's theory of cyclical growth based on employment and wage share dynamics; Keynes–Kaldor–Kalecki's demand and investment-oriented theories of cycles; and Minsky's financial instability hypothesis whereby capitalist economies show a genetic propensity to boom–bust cycles. This literature has been out of favor for many years but recent developments suggest a re-examination is warranted and timely.

Author Notes

We would like to thank Arkady Gevorkyan and Aleksandra Kotlyar for excellent research assistance in writing this paper. We also want to thank Askar A. Akayev, Dmitry K. Chistilin, and the organizers and participants of the Kuznets conference in Kiev, May 2011, for their helpful suggestions. Discussions with various colleagues from the New School for Social Research and the University of Bielefeld, as well as with Peter Flaschel, James Ramsey, and Mauro and Marco Gallegati are also gratefully acknowledged. We also thank two anonymous referees for their comments.

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information