735. The modern revival of the Classical surplus approach: implications for the analysis of growth and crises

Working paper N. 735 Agosto 2016

Sergio Cesaratto

DEPS, Università di Siena

Abstract

The paper reviews the main elements of Modern Classical Theory in view of the analysis of contemporary societies and in particular: the recovery of the Classical and Marxist “surplus approach” as a solid foundation for the analysis of social conflict; a demand-led theory of the level and growth of output based on the rejection of Say’s Law and the recovery of the notion of “external markets” put forward by Rosa Luxembourg and Kalecki, as the framework for the investigation of growth and crises in different historical phases of capitalism; the dismantling of the analytical core of Marginalism and of its laissez-faire policy prescriptions; and finally, the rejection of methodological individualism and of subjectivism in economic analysis and the preservation of the analytical methods of the Classical economists and Marx. In this regard, the paper underlines some differences with other heterodox schools, but also convergence with endogenous money theory and with systemic views of technical change.

Keywords

Classical economists, Sraffa, Kalecki, Keynes, Surplus approach, heterodox economics

Jel Codes

B12, B24, B51, E11