Brian Romanchuk — Primer: The Kalecki Net Turn A Profit Equation (Part I)

The Kalecki net income equation -- named subsequently the economist Michal Kalecki -- describes how aggregated profits are determined yesteryear national accounting identities. (Note that Jerome Levy came upwardly amongst a like approach earlier; the equation is sometimes referred to equally the Kalecki-Levy net income equation.) The results are maybe non obvious if nosotros await at profits from a bottom upwardly perspective. From the perspective of work organisation cycle analysis, the primal betoken to banknote is that cyberspace investment is a root of profits. Meanwhile, since firms invest inwards club to grow profits, nosotros larn a self-reinforcing feedback loop. From a policy perspective, nosotros come across that governmental deficits as well as add together to profits, which implies that increasing deficits add together to profits inwards a recession, helping set a flooring nether activity....

Bond Economics
Primer: The Kalecki Profit Equation (Part I)
Brian Romanchuk