Economic Growth and Macroeconomic Stabilization Policies in Post-Keynesian Economics
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Economic Growth and Macroeconomic Stabilization Policies in Post-Keynesian Economics

Edited by Hassan Bougrine and Louis-Philippe Rochon

Hassan Bougrine, Louis-Philippe Rochon and the expert contributors to this book explore issues of economic growth and full employment; presenting a clear explanation to stagnation, recessions and crises, including the latest Global Financial Crisis of 2007-8. With a central focus on the role played by government spending, deficits and debt as well as the setting of interest rates, the chapters propose alternative policies that can be used by central banks and fiscal authorities to deal with problems of income inequality, unemployment and slow productivity.
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Chapter 16: Dimensions and implications of the slowdown in OECD business investment

Jim Stanford

Abstract

This chapter describes the significant and sustained slowdown in the pace of private business capital accumulation experienced in most OECD economies in the decade since the global financial crisis. This slowdown has been an important factor in the disappointing macroeconomic performance of industrial countries in that period; the slowdown continues a longer-run trend of weaker private-capital accumulation that has been visible in most OECD countries since the advent of neoliberal policy in the 1980s. The chapter summarizes contrasting approaches to business investment embodied in neoclassical and heterodox theory, so as to better interpret the empirical evidence that follows. Several dimensions of the slowdown in OECD business investment are then described, followed by a cataloguing of potential causal factors. Finally, the implications of the slowdown for a heterodox policy framework are considered.

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