In modern capitalist economies, income distribution has a tendency to be in favor of shareholders. This paper interprets pro-shareholder distribution as a decrease in the retention ratio of firms and an increase in the profit share. We introduce labor supply constraints into a post-Keynesian growth model with debt accumulation and investigate the effects of changes in the natural rate of growth, retention ratio, profit share, and interest rate on the rate of capacity utilization and the financial structure of firms. We further analyse the stability of the steady-state equilibrium and the transitional dynamics toward the equilibrium and show that, depending on conditions, there could be cyclical fluctuations such that the financial structure changes periodically between speculative finance and Ponzi finance.
Ryunosuke Sonoda and Hiroaki Sasaki
In this study, we build a Kaleckian model incorporating institutional differences between the wage determination of regular employment and that of non-regular employment. In our model, three types of wage-bargaining regimes are defined based on how regular workers’ collective wage bargaining affects the real wage rate of non-regular workers. We investigate the stability conditions of the dynamical system under each combination of demand regimes and wage-bargaining regimes. We also conduct comparative static analysis and show that the effects of changes in the parameters are diverse depending on combinations of demand regimes and wage-bargaining regimes.