The role of autonomous demand growth in a neo-Kaleckian conflicting-claims framework

This paper incorporates the role of an independently growing autonomous demand component into a neo-Kaleckian model of growth and distribution where the distribution of income is fully endogenized. The model presents the combined dynamic effects of the conflicting-claims, the Sraffian supermultiplier, the Harrodian instability mechanism and the reserve army of labor forces. The key features of the model include the convergence towards the steady state in the long run where it achieves the normal rate of utilization of capacity and the stable rates of employment and inflation. Even with this classical convergence, the model vindicates that some of the main Keynesian tenets still hold even in the long run in the sense that both the average rates of accumulation and utilization decrease during the whole traverse after either an increase in the marginal propensity to save out of profits, or an upward adjustment in the claims on profits, or an enhancement of the bargaining power of capitalists relative to workers.