The Importance of the Retention Ratio in a Kaleckian Model with Debt Accumulation

Abstract

Hein (2007) investigates the effects of debt of firms and interest rates on output and growth, and obtains the following three results. First, the long-run equilibrium is stable only if the short-run equilibrium is debt-led growth. Second, to obtain a positive long-run equilibrium value of the debt-capital ratio under the debt-led growth regime, extremely… (More)

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