A conservative approach to economic growth has dominated policy circles for close to two decades. This approach holds that the key to restoring economic growth lies in reducing the size and role of government in the market economy through deregulation of the financial sector, privatization, and lower taxes. The contributors to this 1995 book argue that the principles of 'trickle down' economics are of dubious validity, and have led to economic stagnation, high unemployment, and increasing inequality. They develop a fresh perspective on macroeconomic policy, one affirming that egalitarian and democratic economic structures are not only compatible with economic revival, but in fact offers sustainable growth of living standards. Their alternative recognizes that markets have an important role to play, but only within the framework of macroeconomic stability, corrections of market failures, and egalitarian rules of the game.
• Offers a fresh and controversial approach to economic policy, arguing that free market 'trickle down' economics has failed • Good line-up of major non-mainstream economists offer an alternative which sees economic equality as vital to economic growth • Includes a wealth of evidence and analysis of the working of many Western economies, Japan and Latin American countries
Part I. Introduction: 1. Macroeconomic policies for sustainable growth Gerald Epstein and Herbert Gintis; 2. Stability, in egalitarianism and stagnation: an overview of the advanced capitalist countries in the 1980s Andrew Glyn; Part II. Savings, Investment and Employment: 3. Putting the horse (back) before the cart: disentangling the macro relationship between investment and saving David M. Gordon; 4. US national saving and budget deficits Robert Eisner; 5. Wages, aggregate demand, and employment in an open economy: a theoretical and empirical investigation Samuel Bowles and Robert Boyer; PART III. The Determinants of Investment: Profits, Demand, Debt, and Expectations: 6. Investment and profitability: the evidence from the advanced capitalist countries V. Bhaskar and Andrew Glyn; 7. Expectations and investment: an economic defense of animal spirits Christopher Heye; 8. Private investment and debt overhang in Latin America Manuel Pastor; Part IV. Finance and Accumulation: Efficiency and Instability: 9. Financial innovation, deregulation, and Minsky cycles Peter Skott; 10. Financial liberalization, capital rationing, and the informal sector in developing countries J. Mohan Rao; 11. International profit rate equalization and investment: an empirical analysis of integration, instability, and enforcement Gerald A. Epstein; 12. Growth, distribution, and the rules of the game: left structuralist macro foundations for a democratic economic policy David Gordon; 13. A dual agency approach to state and market Gerald Epstein and Herbert Gintis; 14. Escaping the efficiency equity trade-off: productivity-enhancing asset redistributions Samuel Bowles and Herbert Gintis.