A Note on the Theory of Demand-Led Growth
Posted: 29 Sep 2001
This paper presents a demand-led growth model where an exogenous investment function drives capital accumulation through a Bernoulli differential equation. In such a framework investment generates savings through changes in capacity utilisation and/or income distribution, making economic growth totally demand-led. Taking a Structuralist perspective the model is constructed to be consistent with different Keynesian closures for the investment function, as well as with different assumptions about savings' adjustment to investment.
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