Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

A Theory of Accumulation and Secular Stagnation: A Malthusian Approach to Understanding a Contemporary MalaiseThe Theory of Accumulation and Secular Stagnation

A Theory of Accumulation and Secular Stagnation: A Malthusian Approach to Understanding a... [Secular stagnation—a condition of low growth and underemployment of resources—can arise when some agents intend never to spend a portion of their income. If savers intend to spend all their income in the future, there is an incentive to invest to meet that future demand. If savers do not plan to spend all their income in the future, the portion of income not intended to be spent is “Accumulation”. If Accumulation is correctly anticipated, it will lower expectations of future demand and deter investment, which will cause the economy to operate below full employment. If Accumulation is not correctly anticipated, investment will go on, but will lead to a crisis of over-production in the future, when the anticipated demand fails to materialize.1] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

A Theory of Accumulation and Secular Stagnation: A Malthusian Approach to Understanding a Contemporary MalaiseThe Theory of Accumulation and Secular Stagnation

Download PDF
20 pages

Loading next page...
 
/lp/springer-journals/a-theory-of-accumulation-and-secular-stagnation-a-malthusian-approach-9i05X0Msl4
Publisher
Palgrave Macmillan US
Copyright
© The Editor(s) (if applicable) and The Author(s) 2016
ISBN
978-1-349-71984-6
Pages
67 –87
DOI
10.1057/9781137562210_4
Publisher site
See Chapter on Publisher Site

Abstract

[Secular stagnation—a condition of low growth and underemployment of resources—can arise when some agents intend never to spend a portion of their income. If savers intend to spend all their income in the future, there is an incentive to invest to meet that future demand. If savers do not plan to spend all their income in the future, the portion of income not intended to be spent is “Accumulation”. If Accumulation is correctly anticipated, it will lower expectations of future demand and deter investment, which will cause the economy to operate below full employment. If Accumulation is not correctly anticipated, investment will go on, but will lead to a crisis of over-production in the future, when the anticipated demand fails to materialize.1]

Published: Aug 5, 2016

Keywords: Accumulation; debt-deflation; Greenspan’s conundrum; secular stagnation

There are no references for this article.