Kaldor (Keynesian) Models

Abstract

The basic Kaldor (Keynesian) model of 11.8 takes the differential form of the saving function: S = sY where s = s^w + (s^p − s^w)(P/Y), depending on the distribution of income between profits (P) and wages (Y − P), and on the proportions of saving out of profits (s^p) and out of wages (s^w). A special but particularly convenient case is that of the classical saving function where all saving is out of profits and S = s^pP.