Normal Paths of Growth Shaped by the Supermultiplier

  • Óscar Dejuán


The Keynesian principle of effective demand states that the equilibrium level of output in a given period is a multiple of the expected autonomous demand (Kalecki, 1971; Keynes, 1936). Can we extrapolate this principle to a long-run dynamic analysis and conclude that the rate of growth of output will eventually depend on the expected rate of growth of autonomous demand? A positive answer would be a significant step towards a long-period theory of output which, according to Eatwell and Milgate, provides the most solid ground for demand-led growth (Milgate, 1982; Eatwell, 1983; Eatwell and Milgate, 1983; Eatwell, 2012).


Aggregate Demand Capacity Utilisation Mortgage Loan Normal Capacity Productive Investment 
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  • Óscar Dejuán

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