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Profit‐Rate Equalization in the Kalecki–Steindl Model and the “Over‐Determination” Problem
Author(s) -
Dutt Amitava Krishna
Publication year - 1997
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/1467-9957.00074
Subject(s) - economics , interpretation (philosophy) , profit (economics) , mathematical economics , rate of profit , microeconomics , neoclassical economics , computer science , programming language
This note points out that the “over‐determination” problem discovered by Park in Kalecki–Steindl (KS) models is not a problem intrinsic to KS models and can easily be removed if one introduces a mechanism involving classical competition into them. The solution to the problem suggested by Park using a moving‐average interpretation is therefore unnecessary, and also it does not provide an adequate solution to the “over‐determination” problem. However, the interpretation does serve to clarify the meaning of long‐run equilibria in KS models.