Michał Kalecki (; 22 June 1899 – 18 April 1970) was a Polish
Marxian economist. Over the course of his life, Kalecki worked at the
London School of Economics
, mottoeng = To understand the causes of things
, established =
, type = Public research university
, endowment = £240.8 million (2021)
, budget = £391.1 milli ...
,
University of Cambridge
, mottoeng = Literal: From here, light and sacred draughts.
Non literal: From this place, we gain enlightenment and precious knowledge.
, established =
, other_name = The Chancellor, Masters and Schola ...
,
University of Oxford
, mottoeng = The Lord is my light
, established =
, endowment = £6.1 billion (including colleges) (2019)
, budget = £2.145 billion (2019–20)
, chancellor ...
and
Warsaw School of Economics and was an economic advisor to the governments of
Poland
Poland, officially the Republic of Poland, is a country in Central Europe. It is divided into 16 administrative provinces called voivodeships, covering an area of . Poland has a population of over 38 million and is the fifth-most populou ...
,
France
France (), officially the French Republic ( ), is a country primarily located in Western Europe. It also comprises of Overseas France, overseas regions and territories in the Americas and the Atlantic Ocean, Atlantic, Pacific Ocean, Pac ...
,
Cuba
Cuba ( , ), officially the Republic of Cuba ( es, República de Cuba, links=no ), is an island country comprising the island of Cuba, as well as Isla de la Juventud and several minor archipelagos. Cuba is located where the northern Caribb ...
,
Israel
Israel (; he, יִשְׂרָאֵל, ; ar, إِسْرَائِيل, ), officially the State of Israel ( he, מְדִינַת יִשְׂרָאֵל, label=none, translit=Medīnat Yīsrāʾēl; ), is a country in Western Asia. It is situated ...
,
Mexico
Mexico (Spanish language, Spanish: México), officially the United Mexican States, is a List of sovereign states, country in the southern portion of North America. It is borders of Mexico, bordered to the north by the United States; to the so ...
and
India
India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the List of countries and dependencies by area, seventh-largest country by area, the List of countries and dependencies by population, second-most populous ...
. He also served as the deputy director of the
United Nations Economic Department in New York City.
Kalecki has been called "one of the most distinguished economists of the 20th century" and "likely the most original one". It is often claimed that he developed many of the
same ideas as
John Maynard Keynes
John Maynard Keynes, 1st Baron Keynes, ( ; 5 June 1883 – 21 April 1946), was an English economist whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments. Originally trained in ...
before Keynes, but he remains much less known to the English-speaking world. He offered a synthesis that integrated
Marxist
Marxism is a left-wing to far-left method of socioeconomic analysis that uses a materialist interpretation of historical development, better known as historical materialism, to understand class relations and social conflict and a dialecti ...
class analysis and the new literature on
oligopoly theory, and his work had a significant influence on both the
neo-Marxian (''
Monopoly Capital'')
and
post-Keynesian
Post-Keynesian economics is a school of economic thought with its origins in '' The General Theory'' of John Maynard Keynes, with subsequent development influenced to a large degree by Michał Kalecki, Joan Robinson, Nicholas Kaldor, Sidney ...
schools of economic thought. He was one of the first
macroeconomists to apply
mathematical model
A mathematical model is a description of a system using mathematical concepts and language. The process of developing a mathematical model is termed mathematical modeling. Mathematical models are used in the natural sciences (such as physics, ...
s and
statistical
Statistics (from German: '' Statistik'', "description of a state, a country") is the discipline that concerns the collection, organization, analysis, interpretation, and presentation of data. In applying statistics to a scientific, industr ...
data
In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
to economic questions. Being also a
political economist and a person of
leftist
Left-wing politics describes the range of political ideologies that support and seek to achieve social equality and egalitarianism, often in opposition to social hierarchy. Left-wing politics typically involve a concern for those in so ...
convictions, Kalecki emphasized the
social
Social organisms, including human(s), live collectively in interacting populations. This interaction is considered social whether they are aware of it or not, and whether the exchange is voluntary or not.
Etymology
The word "social" derives from ...
aspects and consequences of economic policies.
Kalecki made major theoretical and practical contributions in the areas of the
business cycle
Business cycles are intervals of expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are measured by examin ...
,
growth
Growth may refer to:
Biology
* Auxology, the study of all aspects of human physical growth
* Bacterial growth
* Cell growth
* Growth hormone, a peptide hormone that stimulates growth
* Human development (biology)
* Plant growth
* Secondary grow ...
,
full employment
Full employment is a situation in which there is no cyclical or deficient-demand unemployment. Full employment does not entail the disappearance of all unemployment, as other kinds of unemployment, namely structural and frictional, may remain. F ...
,
income distribution, the political boom cycle, the oligopolistic economy, and
risk
In simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environm ...
. Among his other significant interests were
monetary
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are ...
issues,
economic development
In the economics study of the public sector, economic and social development is the process by which the economic well-being and quality of life of a nation, region, local community, or an individual are improved according to targeted goals and ...
,
finance
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of f ...
,
interest
In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is distin ...
, and
inflation
In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduct ...
. In 1970, Kalecki was nominated for the
Nobel Memorial Prize in Economics
The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ( sv, Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is an economics award administered ...
, but he died the same year.
Biography
Early years: 1899–1933
Michał Kalecki was born on 22 June 1899 in
Łódź
Łódź, also rendered in English as Lodz, is a city in central Poland and a former industrial centre. It is the capital of Łódź Voivodeship, and is located approximately south-west of Warsaw. The city's coat of arms is an example of ca ...
,
Congress Poland
Congress Poland, Congress Kingdom of Poland, or Russian Poland, formally known as the Kingdom of Poland, was a polity created in 1815 by the Congress of Vienna as a semi-autonomous Polish state, a successor to Napoleon's Duchy of Warsaw. I ...
, then part of the
Russian Empire
The Russian Empire was an empire and the final period of the Russian monarchy from 1721 to 1917, ruling across large parts of Eurasia. It succeeded the Tsardom of Russia following the Treaty of Nystad, which ended the Great Northern War ...
. Information about his early years is very sparse, part of it being lost during the
Nazi occupation, but he grew up in a major labor-turbulent industrial center, which affected his future views.
In 1917 Kalecki enrolled at the
Warsaw Polytechnic
The Warsaw University of Technology ( pl, Politechnika Warszawska, lit=Varsovian Polytechnic) is one of the leading institutes of technology in Poland and one of the largest in Central Europe. It employs 2,453 teaching faculty, with 357 professor ...
to study
civil engineering
Civil engineering is a professional engineering discipline that deals with the design, construction, and maintenance of the physical and naturally built environment, including public works such as roads, bridges, canals, dams, airports, sewa ...
.
He was a very able student and formalized a generalization of
Pascal's theorem, concerning a
hexagon
In geometry, a hexagon (from Greek , , meaning "six", and , , meaning "corner, angle") is a six-sided polygon. The total of the internal angles of any simple (non-self-intersecting) hexagon is 720°.
Regular hexagon
A '' regular hexagon'' has ...
drawn within a second-degree curve: Kalecki generalized it for a
polygon
In geometry, a polygon () is a plane figure that is described by a finite number of straight line segments connected to form a closed '' polygonal chain'' (or ''polygonal circuit''). The bounded plane region, the bounding circuit, or the two ...
of 2n sides.
Because his father lost a small textile workshop, Kalecki had to obtain a job as an accountant; during his first year in
Warsaw
Warsaw ( pl, Warszawa, ), officially the Capital City of Warsaw,, abbreviation: ''m.st. Warszawa'' is the capital and largest city of Poland. The metropolis stands on the River Vistula in east-central Poland, and its population is officiall ...
he continued working sporadic jobs. After finishing his first year of engineering, he had to interrupt his studies from 1918 to 1921 to complete military service. Upon leaving the military he joined
Gdańsk Polytechnic, where he stayed until 1923, but because of the family financial situation had to leave the institution just before graduating.
During these years he first approached economics, although informally. He read mostly "unorthodox" works, particularly those of
Mikhail Tugan-Baranovsky and
Rosa Luxemburg
Rosa Luxemburg (; ; pl, Róża Luksemburg or ; 5 March 1871 – 15 January 1919) was a Polish and naturalised-German revolutionary socialism, revolutionary socialist, Marxism, Marxist philosopher and anti-war movement, anti-war activist. Succ ...
. Years later they influenced some of his writings related to the potential growth of a capitalist system.
Having to enter the job market full-time, Kalecki abandoned his formal studies for good. His first job was to collect data on companies seeking credit. In this same period he tried unsuccessfully to start a newspaper, but instead ended up writing articles for two existing periodicals, ''Polska gospodarcza'' ('Economic Poland') and ''Przegląd gospodarczy'' ('The Economic Review'). Probably when writing these articles he began to acquire skills in obtaining and analyzing empirical information, which he later used in his professional works.
In 1929 Kalecki applied for work at the Institute of Research on Business Cycles and Prices (''Instytut Badania Koniunktur Gospodarczych i Cen'') in Warsaw and obtained a job there because of his ability to use
statistics
Statistics (from German: '' Statistik'', "description of a state, a country") is the discipline that concerns the collection, organization, analysis, interpretation, and presentation of data. In applying statistics to a scientific, indust ...
. He stayed there for seven years.
On 18 June 1930 he married Ada Szternfeld. At the Institute he met
Ludwik Landau, whose knowledge of statistics influenced Kalecki's work. His first publications were of a practical character and were concerned with establishing relationships between macro-magnitudes. The first article that anticipated many subsequent contributions was published in 1932 in ''Przegląd socjalistyczny'' ('The Socialist Review') magazine, under the pseudonym Henryk Braun. The article dealt with the impact of wage cuts during an economic downturn.
Revolution of Kalecki and Keynes: 1933–1939
In 1933 Kalecki wrote ''Próba teorii koniunktury'' ('An Attempt at the Theory of the Business Cycle'), an essay that brought together many of the issues that dominated his thought for the rest of his life. In the essay Kalecki for the first time developed a comprehensive theory of
business cycle
Business cycles are intervals of expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are measured by examin ...
s. The foundations of his
macroeconomic
Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole.
For example, using interest rates, taxes, an ...
theory of
effective demand
In economics, effective demand (ED) in a market is the demand for a product or service which occurs when purchasers are constrained in a different market. It contrasts with notional demand, which is the demand that occurs when purchasers are not ...
presented in the paper anticipated similar ideas published three years later by
John Maynard Keynes
John Maynard Keynes, 1st Baron Keynes, ( ; 5 June 1883 – 21 April 1946), was an English economist whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments. Originally trained in ...
in ''
The General Theory of Employment, Interest and Money''.
According to
Lawrence Klein (1951), Kalecki "created a system that contains everything of importance in the Keynesian system, in addition to other contributions".
In an introduction to the essay's 1966 English translation,
Joan Robinson
Joan Violet Robinson (''née'' Maurice; 31 October 1903 – 5 August 1983) was a British economist well known for her wide-ranging contributions to economic theory. She was a central figure in what became known as post-Keynesian economics.
...
wrote: "Its sharp and concentrated statement provides a better introduction to the general theory of employment, interest and money than any that has yet been produced."
Except for a small number of economists (in particular
econometrists) familiar with his work, Kalecki's contributions, originally in Polish, failed to gain recognition.
In October 1933 he read his essay to the International Econometrics Association in
Leiden
Leiden (; in English and archaic Dutch also Leyden) is a city and municipality in the province of South Holland, Netherlands. The municipality of Leiden has a population of 119,713, but the city forms one densely connected agglomeration w ...
and in 1935 published it in two major journals: ''Revue d'Economie Politique'' and ''
Econometrica
''Econometrica'' is a peer-reviewed academic journal of economics, publishing articles in many areas of economics, especially econometrics. It is published by Wiley-Blackwell on behalf of the Econometric Society. The current editor-in-chief is ...
''.
Readers of neither journal were particularly impressed, but the article received favourable comments from such leading economists as
Ragnar Frisch
Ragnar Anton Kittil Frisch (3 March 1895 – 31 January 1973) was an influential Norwegian economist known for being one of the major contributors to establishing economics as a quantitative and statistically informed science in the early 20th c ...
and
Jan Tinbergen.
In 1936 Kalecki protested the politically motivated actions taken by the Institute of Research against his colleagues, including Landau. Kalecki resigned, and having been granted a
Rockefeller Foundation
The Rockefeller Foundation is an American private foundation and philanthropy, philanthropic medical research and arts funding organization based at 420 Fifth Avenue, New York City. The second-oldest major philanthropic institution in America, aft ...
's Traveling Fellowship, proceeded to work abroad.
Had he not received the fellowship, the war would have caught Kalecki in Poland and, given his Jewish origins, he would probably not have survived.
The scholarship enabled Kalecki to travel with his wife to
Sweden
Sweden, formally the Kingdom of Sweden,The United Nations Group of Experts on Geographical Names states that the country's formal name is the Kingdom of SwedenUNGEGN World Geographical Names, Sweden./ref> is a Nordic countries, Nordic c ...
, where followers of
Knut Wicksell
Johan Gustaf Knut Wicksell (December 20, 1851 – May 3, 1926) was a leading Swedish economist of the Stockholm school. His economic contributions would influence both the Keynesian and Austrian schools of economic thought. He was married to t ...
were trying to formalize a theory similar to Kalecki's. In Sweden in 1936 he learnt of the publication of Keynes's ''General Theory''. Kalecki was working on a comprehensive elaboration of the economic ideas he had previously developed, but having found in Keynes's book much of what he was going to say, he interrupted his work and traveled to
England
England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe ...
.
He first visited the
London School of Economics
, mottoeng = To understand the causes of things
, established =
, type = Public research university
, endowment = £240.8 million (2021)
, budget = £391.1 milli ...
and afterward went to
Cambridge
Cambridge ( ) is a university city and the county town in Cambridgeshire, England. It is located on the River Cam approximately north of London. As of the 2021 United Kingdom census, the population of Cambridge was 145,700. Cambridge bec ...
.
Thus began his friendships with
Richard Kahn, Joan Robinson and
Piero Sraffa
Piero Sraffa (5 August 1898 – 3 September 1983) was an influential Italian economist who served as lecturer of economics at the University of Cambridge. His book ''Production of Commodities by Means of Commodities'' is taken as founding the n ...
, which left an indelible mark on all of them. In 1937 Kalecki met Keynes. The meeting was cool and Keynes kept aloof. Although the conclusions they had reached in their work were very similar, their characters could not have been more different. Kalecki graciously neglected to mention that he had a
priority of publication. As Joan Robinson stated:
Later Kalecki always acknowledged that the "
Keynesian Revolution" was an appropriate name for the movement in economics, as he realized the importance of Keynes's established position, the recognition Keynes enjoyed and his decisive role in the promotion and causing eventual acceptance of the ideas that Kalecki pioneered.
In 1939 Kalecki wrote one of his most important works, ''Essays in the Theory of Economic Fluctuations''. Although his conception changed through the years, all the essential elements of Kaleckian economics were already present in this work: in a sense his subsequent publications would consist of mere elaborations on the ideas propounded here.
While Kalecki was generally enthusiastic about the Keynesian Revolution, in his article ''Political Aspects of Full Employment'', which
Anatole Kaletsky
Anatole Kaletsky (born 1 June 1952) is an economist and journalist based in the United Kingdom. He has written since 1976 for ''The Economist'', ''The Financial Times'' and ''The Times of London'' before joining Reuters and '' The Internationa ...
called one of the most prescient economic papers ever published, he predicted it would not endure.
Kalecki believed that the
full employment
Full employment is a situation in which there is no cyclical or deficient-demand unemployment. Full employment does not entail the disappearance of all unemployment, as other kinds of unemployment, namely structural and frictional, may remain. F ...
delivered by Keynesian policy would eventually lead to a more assertive
working class
The working class (or labouring class) comprises those engaged in manual-labour occupations or industrial work, who are remunerated via waged or salaried contracts. Working-class occupations (see also " Designation of workers by collar colou ...
and weakening of the social position of business leaders, causing the elite to react to the erosion of their political power and force a
displacement of that policy, in spite of profits being higher than under a ''
laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups ...
'' system.
World War II years: 1939–1945
Kalecki was hired by the Oxford Institute of Statistics (OIS) early in 1940. His job there consisted mainly of writing statistical and economic analysis for the British government of the management of
war economy
A war economy or wartime economy is the set of contingencies undertaken by a modern state to mobilize its economy for war production. Philippe Le Billon describes a war economy as a "system of producing, mobilizing and allocating resources t ...
.
Occasionally he gave lectures at
Oxford University
Oxford () is a city in England. It is the county town and only city of Oxfordshire. In 2020, its population was estimated at 151,584. It is north-west of London, south-east of Birmingham and north-east of Bristol. The city is home to the ...
. The elaborate reports Kalecki prepared for the government were chiefly about the
rationing
Rationing is the controlled distribution of scarce resources, goods, services, or an artificial restriction of demand. Rationing controls the size of the ration, which is one's allowed portion of the resources being distributed on a particular ...
of goods, and the scheme he developed was very close to the policies adopted later when rationing was introduced.
According to George Feiwel, "Kalecki's work of the war period is far less known than it deserves to be".
Several of Kalecki's wartime articles were devoted to the subject of
inflation
In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduct ...
. He argued, on economic grounds, against the government's efforts to suppress inflation by official regulation of prices and by government wage stabilization (freezing of wages), recommending in each case economic rationing instead (especially the full rationing system rather than the wage stabilization program).
Some of Kalecki's major works were written during this period. In 1943 he produced two articles, one dealing with new additions to the traditional business cycle theory, and one presenting his completely original theory of business cycles caused by political events. The latter was published in 1944 and was based on the premise of full employment. It was a compilation of studies by Kalecki and his colleagues at the OIS, who were strongly influenced by Kalecki'.
In 1945 Kalecki left the OIS because he felt his talents were insufficiently appreciated. He displayed great modesty about his work and did not expect a high salary, but was offended at being discriminated against on account of his immigrant status. One reason he was not appointed to a more senior position was that he had not applied to become a British subject.
Postwar years: 1945–1955
Kalecki went to
París
Paris () is the capital and most populous city of France, with an estimated population of 2,165,423 residents in 2019 in an area of more than 105 km² (41 sq mi), making it the 30th most densely populated city in the world in 2020. ...
for a while, then moved to
Montreal
Montreal ( ; officially Montréal, ) is the second-most populous city in Canada and most populous city in the Canadian province of Quebec. Founded in 1642 as '' Ville-Marie'', or "City of Mary", it is named after Mount Royal, the triple- ...
, where he stayed for fifteen months working at the
International Labour Office
The International Labour Organization (ILO) is a United Nations agency whose mandate is to advance social and economic justice by setting international labour standards. Founded in October 1919 under the League of Nations, it is the first and o ...
.
In July 1946 he accepted the Polish government's invitation to head the Central Planning Office of the Ministry of Economics, but he left some months later. By the end of 1946, he assumed the job of Deputy Director in the Department of Economic Affairs of the
United Nations Secretariat in
New York
New York most commonly refers to:
* New York City, the most populous city in the United States, located in the state of New York
* New York (state), a state in the northeastern United States
New York may also refer to:
Film and television
* '' ...
. He remained there until 1955, mainly preparing the World Economic Reports.
Kalecki resigned that position as a result of
McCarthyist
McCarthyism is the practice of making false or unfounded accusations of subversion and treason, especially when related to anarchism, communism and socialism, and especially when done in a public and attention-grabbing manner.
The term origina ...
pressures.
It was argued that he was punished on political grounds (a non-merited economic planner stance was attributed to him). He became depressed by Senator
Joseph McCarthy
Joseph Raymond McCarthy (November 14, 1908 – May 2, 1957) was an American politician who served as a Republican United States Senate, U.S. Senator from the state of Wisconsin from 1947 until his death in 1957. Beginning in 1950, McCarth ...
's witch-hunt, as many of his close friends were directly affected. Denounced in the
US Senate
The United States Senate is the upper chamber of the United States Congress, with the House of Representatives being the lower chamber. Together they compose the national bicameral legislature of the United States.
The composition and po ...
as a supporter of
communism
Communism (from Latin la, communis, lit=common, universal, label=none) is a far-left sociopolitical, philosophical, and economic ideology and current within the socialist movement whose goal is the establishment of a communist society, ...
, Kalecki ultimately failed to achieve professional success in the US (although he influenced the future post-Keynesians there),
unlike in England, where he had a large following and was supported especially by his friend
Joan Robinson
Joan Violet Robinson (''née'' Maurice; 31 October 1903 – 5 August 1983) was a British economist well known for her wide-ranging contributions to economic theory. She was a central figure in what became known as post-Keynesian economics.
...
.
In communist Poland: 1955–1968
In 1955 Kalecki returned to Poland, never to work abroad for any extended period again. Hopeful for an opportunity to participate there in reforms that were
socially advantageous, he believed that
socialism
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes th ...
would avoid the miseries brought by capitalist policies.
He became economic advisor to the Office of the Council of Ministers. In 1957, he was appointed chairman of the Central Commission for Perspective Planning.
The perspective plan had a time horizon of 1961 to 1975 and basically meant a practical implementation of Kalecki's theories of growth in
socialist economies
Socialist economics comprises the economic theories, practices and norms of hypothetical and existing socialist economic systems. A socialist economic system is characterized by social ownership and operation of the means of production that may ...
.
However, the final plan developed by Kalecki was dismissed by board members as defeatist. Then things got worse, as related by Feiwel:
Still holding some of his government appointments, Kalecki spent much of the rest of his professional life in teaching and research, as a university professor from 1956 (
Central School of Planning and Statistics and the
University of Warsaw
The University of Warsaw ( pl, Uniwersytet Warszawski, la, Universitas Varsoviensis) is a public university in Warsaw, Poland. Established in 1816, it is the largest institution of higher learning in the country offering 37 different fields of ...
) and member of the
Polish Academy of Sciences
The Polish Academy of Sciences ( pl, Polska Akademia Nauk, PAN) is a Polish state-sponsored institution of higher learning. Headquartered in Warsaw, it is responsible for spearheading the development of science across the country by a society o ...
from 1957.
In 1959, he began directing a seminar on socioeconomic problems of the
Third World
The term "Third World" arose during the Cold War to define countries that remained non-aligned with either NATO or the Warsaw Pact. The United States, Canada, Japan, South Korea, Western European nations and their allies represented the " First ...
, along with
Oskar R. Lange and
Czesław Bobrowski. He was instrumental in the establishment and functioning of the Department of Economic Problems in Developing Countries, operated jointly by Warsaw University and the School of Planning and Statistics.
When the
1968 Polish political crisis unfolded, Kalecki retired in protest against the wave of antisemitic dismissals and firings that affected many of his colleagues.
He also devoted this period to the study of
mathematics
Mathematics is an area of knowledge that includes the topics of numbers, formulas and related structures, shapes and the spaces in which they are contained, and quantities and their changes. These topics are represented in modern mathematics ...
. In part this was a continuation of the interest he had when he was young and generalized Pascal's theorem. His investigations now centered on
number theory
Number theory (or arithmetic or higher arithmetic in older usage) is a branch of pure mathematics devoted primarily to the study of the integers and integer-valued functions. German mathematician Carl Friedrich Gauss (1777–1855) said, "Ma ...
and
probability
Probability is the branch of mathematics concerning numerical descriptions of how likely an event is to occur, or how likely it is that a proposition is true. The probability of an event is a number between 0 and 1, where, roughly speaking, ...
. Kalecki's engagement in mathematics helped him to relieve the extreme disappointment caused by the lack of power to help his country in
economic policy
The economy of governments covers the systems for setting levels of taxation, government budgets, the money supply and interest rates as well as the labour market, national ownership, and many other areas of government interventions into the ec ...
.
In retirement: 1968–1970
Kalecki kept writing research articles. During his last visit to Cambridge in 1969, his seventieth birthday was celebrated. Kalecki gave a University Lecture on the theories of growth under various social systems, after which he was greatly applauded for the soundness of his arguments as well as for the overall trajectory of his life.
Keynes had said that knowledge of the laws governing capitalist economy would make people more prosperous, happy and more responsible regarding economic decisions taken. Kalecki contested this view, arguing that the idea of political business cycle (governments can force situations to their advantage) seems to point in the opposite direction. As he grew older, Kalecki was ever more convinced of this, and his view of humanity was getting increasingly pessimistic.
Michał Kalecki died on 18 April 1970 at the age of 70, and although he was bitterly disappointed with political developments, he lived long enough to see the recognition of the value of his many original contributions to economics. Feiwel wrote the following summary of Kalecki's life:
Contributions to economics
Background and overview
Despite the fact that Kalecki authored many theoretical economic constructs, his interest in economics was more practical than academic and resulted from his work in engineering, journalism, credit investigation, use of statistics and observation of business operations. Full-time university teaching, for which he did not have formal qualifications (a degree), he did only during the last thirteen years of his career. He was contemptuous of abstract research and declined Keynes's invitation to undertake a critique of
Jan Tinbergen's
econometric business cycle
Business cycles are intervals of expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are measured by examin ...
work, for which he would also lack an in-depth knowledge of
statistical theory
The theory of statistics provides a basis for the whole range of techniques, in both study design and data analysis, that are used within applications of statistics.
The theory covers approaches to statistical-decision problems and to statistica ...
.
Kalecki stressed that the predominant
economic growth
Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate o ...
models were built on the assumption of an idealized ''
laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups ...
'' capitalism and did not properly take into account the crucial and empirically demonstrable role of the
government sector, the state's intervention and the interaction between the state and private sectors.
In 1943 Kalecki wrote: '... "discipline in the factories" and "political stability" are more appreciated by the business leaders than are profits. Their class instinct tells them that lasting full employment is unsound from their point of view and that unemployment is an integral part of the normal capitalist system.' The capitalists therefore want to limit government intervention and spending as disruptions to ''laissez-faire'' that reduce their "state of confidence" in the overall economic performance, with the notable exception of armament spending and policies that lead to increased armament spending (the last point Kalecki emphasized again in 1967).
The economics of Kalecki was based, more explicitly and systematically than that of Keynes, on the principle of the
circular flow of income that goes back to the
Physiocrat
Physiocracy (; from the Greek for "government of nature") is an economic theory developed by a group of 18th-century Age of Enlightenment French economists who believed that the wealth of nations derived solely from the value of "land agricult ...
François Quesnay
François Quesnay (; 4 June 1694 – 16 December 1774) was a French economist and physician of the Physiocratic school. He is known for publishing the " Tableau économique" (Economic Table) in 1758, which provided the foundations of the ideas ...
. According to that principle, income is determined by expenditure decisions, not by the exchange of resources (capital or labor). Kalecki and Keynes claimed that in capitalist economy, production and employment levels (
economic equilibrium
In economics, economic equilibrium is a situation in which economic forces such as supply and demand are balanced and in the absence of external influences the ( equilibrium) values of economic variables will not change. For example, in the st ...
) are determined foremost by the magnitude of
investment
Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort.
In finance, the purpose of investing is ...
by business enterprises (the crucial "driver of the business cycle"), not by price and wage flexibility. Savings are determined by investments, not the other way around. Contrary to the
Ricardian,
Marxian and
Neoclassical economics, Kalecki asserted that higher wages lead to fuller employment. His
monetary theory was rooted in the business cycle theory of
Knut Wicksell
Johan Gustaf Knut Wicksell (December 20, 1851 – May 3, 1926) was a leading Swedish economist of the Stockholm school. His economic contributions would influence both the Keynesian and Austrian schools of economic thought. He was married to t ...
. Quesnay's circular flow of income fell into disrepute in the
political economy
Political economy is the study of how economic systems (e.g. markets and national economies) and political systems (e.g. law, institutions, government) are linked. Widely studied phenomena within the discipline are systems such as labour ...
of the 19th century, when the idea that prices integrate exchange decisions gained ground, but was revived by
Joseph Schumpeter
Joseph Alois Schumpeter (; February 8, 1883 – January 8, 1950) was an Austrian-born political economist. He served briefly as Finance Minister of German-Austria in 1919. In 1932, he emigrated to the United States to become a professor at H ...
, who pointed out the necessity of considering the circular flow of income (recognition of the
economic cycle) as an integrating factor in order to gain a comprehensive understanding of the total economic process in a given period. The principle was discarded again with the arrival of
neoliberal
Neoliberalism (also neo-liberalism) is a term used to signify the late 20th century political reappearance of 19th-century ideas associated with free-market capitalism after it fell into decline following the Second World War. A prominent f ...
domination in economics and its main current defined by prices of economic equilibrium. Economist
Jan Toporowski said that Kalecki's theory of the business cycle remains "the most serious challenge to
general equilibrium
In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting markets, by seeking to prove that the interaction of demand and supply will result in an o ...
macroeconomics", which has prevailed since the late 19th century. More than Keynes, Kalecki was skeptical about government's ability to sustain
fiscal and
monetary
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are ...
stimulus policies or of business support for full employment.
Like Keynes, Kalecki was concerned with
demand management
Demand management is a planning methodology used to forecast, plan for and manage the demand for products and services. This can be at macro-levels as in economics and at micro-levels within individual organizations. For example, at macro-lev ...
. Kalecki distinguished three ways of stimulating demand: through the government improving conditions for private investment (a time-consuming and burdensome for the populace process of which he was skeptical), through
redistribution of income
Redistribution of income and wealth is the transfer of income and wealth (including physical property) from some individuals to others through a social mechanism such as taxation, welfare, public services, land reform, monetary policies, confisc ...
from profits to wages, and through
public investment
Government spending or expenditure includes all government consumption, investment, and transfer payments. In national income accounting, the acquisition by governments of goods and services for current use, to directly satisfy the individual ...
that increases employment and demand automatically.
Kalecki was engaged in the problems of
developing countries
A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...
. He argued that their
industrialization
Industrialisation ( alternatively spelled industrialization) is the period of social and economic change that transforms a human group from an agrarian society into an industrial society. This involves an extensive re-organisation of an econo ...
depended on
land reform
Land reform is a form of agrarian reform involving the changing of laws, regulations, or customs regarding land ownership. Land reform may consist of a government-initiated or government-backed property redistribution, generally of agricultura ...
and taxation of land owners and the
middle class
The middle class refers to a class of people in the middle of a social hierarchy, often defined by occupation, income, education, or social status. The term has historically been associated with modernity, capitalism and political debate. C ...
es. He was skeptical about a positive role of
foreign direct investment
A foreign direct investment (FDI) is an investment in the form of a controlling ownership in a business in one country by an entity based in another country. It is thus distinguished from a foreign portfolio investment by a notion of direct c ...
in stimulating economic modernization. Polish economist
Oskar Lange, who worked with Kalecki also on
centrally planned socialist
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the ...
economies of the
Soviet Bloc
The Eastern Bloc, also known as the Communist Bloc and the Soviet Bloc, was the group of socialist states of Central and Eastern Europe, East Asia, Southeast Asia, Africa, and Latin America under the influence of the Soviet Union that exist ...
, characterized him as a "
leftist
Left-wing politics describes the range of political ideologies that support and seek to achieve social equality and egalitarianism, often in opposition to social hierarchy. Left-wing politics typically involve a concern for those in so ...
Keynesian
Keynesian economics ( ; sometimes Keynesianism, named after British economist John Maynard Keynes) are the various macroeconomic theories and models of how aggregate demand (total spending in the economy) strongly influences economic output an ...
".
According to Toporowski, Kalecki's monetary theory is of particular significance. Unlike Keynes, Kalecki regarded
credit as a fundamental system of financial reckoning in capitalist economy, not just as clearing of payments between
commercial bank
A commercial bank is a financial institution which accepts deposits from the public and gives loans for the purposes of consumption and investment to make profit.
It can also refer to a bank, or a division of a large bank, which deals with ...
s and a
central bank
A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union,
and oversees their commercial banking system. In contrast to a commercial bank, a centra ...
. He saw
monetary policy
Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for federal funds, very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money s ...
as endogenous to the business cycle, dependent on business investment rather than on interest rate and credit policy of central bankers. Unlike Keynes, who followed the
partial equilibrium approach, for Kalecki economic dynamics was synonymous with the business cycle, where "the circular flow of income generates cumulative changes from one period to the next". Kalecki and Lange stressed the necessity of analysis of actually-functioning capitalism in both the advanced and developing countries, before economic theories could be built or courses of action prescribed.
Kalecki's studies of capitalist
enterprises included their finances, investment patterns and factors that influence investment, such as the development of
financial market
A financial market is a market in which people trade financial securities and derivatives at low transaction costs. Some of the securities include stocks and bonds, raw materials and precious metals, which are known in the financial ma ...
s,
microeconomic
Microeconomics is a branch of mainstream economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Microeconomics fo ...
conditions, and governmental
fiscal interventions.
Profit equation
The volume of economic literature written by Kalecki during his life was very large. Although in most of his articles he returned to the same subjects (business cycles, determinants of investment,
socialist planning), he often did it from a slightly unusual perspective and with original contributions.
Kalecki's most famous contribution is his
profit
Profit may refer to:
Business and law
* Profit (accounting), the difference between the purchase price and the costs of bringing to market
* Profit (economics), normal profit and economic profit
* Profit (real property), a nonpossessory inter ...
equation. Kalecki, whose early influences came from Marxian economists,
thought that the volume of profits and their sharing in a capitalist society were vital points to be treated. This followed from
Karl Marx
Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist, critic of political economy, and socialist revolutionary. His best-known titles are the 1848 ...
's work on relationships such as the rate of
surplus value
In Marxian economics, surplus value is the difference between the amount raised through a sale of a product and the amount it cost to the owner of that product to manufacture it: i.e. the amount raised through sale of the product minus the cos ...
or the
organic composition of capital (and even a forecast about the overall trend of profits). However, Marx was not able to make a meaningful statement about the total volume of profits in a given period.
Kalecki derived this relationship in an extremely concise, elegant and intuitive way. He starts by making simplifications which he later progressively eliminates. These assumptions are:
* Divide the whole economy into two groups:
workers
The workforce or labour force is a concept referring to the pool of human beings either in employment or in unemployment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic reg ...
, who earn only
wage
A wage is payment made by an employer to an employee for work done in a specific period of time. Some examples of wage payments include compensatory payments such as ''minimum wage'', '' prevailing wage'', and ''yearly bonuses,'' and remune ...
s, and
capitalists
Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, private pr ...
, who earn only profits.
*Workers do not save.
* The economy is closed (there is no
international trade
International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. (see: World economy)
In most countries, such trade represents a significa ...
) and there is no
public sector
The public sector, also called the state sector, is the part of the economy composed of both public services and public enterprises. Public sectors include the public goods and governmental services such as the military, law enforcement, inf ...
.
With these assumptions Kalecki derives the following
accounting identity In accounting, finance and economics, an accounting identity is an equality that must be true regardless of the value of its variables, or a statement that by definition (or construction) must be true. Where an accounting identity applies, any dev ...
:
where
is the volume of gross profits (profits plus
depreciation
In accountancy, depreciation is a term that refers to two aspects of the same concept: first, the actual decrease of fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wear, and second, the ...
),
is the volume of total wages,
is capitalists' consumption,
is workers' consumption and
is the gross investment that has been made in the economy. Since we have supposed workers who do not save (that is
in the preceding equation), we can simplify the two terms and arrive at:
This is the famous profits equation, which says that profits are equal to the sum of investment and capitalists' consumption.
At this point, Kalecki goes on to determine the causal link between the two sides of the equation: does capitalists' consumption and investment determine profits or profits instead determine capitalists' consumption and investment? Kalecki says,
For someone who has not seen the preceding relationship before, it might, upon examination, seem somewhat paradoxical. If the capitalists consume more, obviously the amount of funds which they have at the end of the year should be less. However, this reasoning, obvious to the individual entrepreneur, is not true for the business class as a whole, as the consumption of one capitalist becomes part of the profits of another. In a way, "they are masters of their fate".
If in the preceding equation we move capitalists' consumption to the left, the equation becomes:
since profits minus capitalists' consumption are the total saving (
) in the economy, because the workers do not save. The previous causal relationship still applies, and goes from investment to saving. That is to say, total savings are determined once investment has been determined. Therefore, in some way, investment generates sufficient resources. "Investment finances itself",
so that equality between savings and investment is not caused by any
interest rate
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, t ...
mechanism as earlier economists thought.
Finally, we can eliminate the assumptions of the original equation: the economy can be open, there may be a
government sector and we can let workers save something. The resulting equation is:
In this model total profits (net
taxes this time) are the sum of capitalists' consumption, investment, public deficit, net external surplus (
export
An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is a ...
s minus
import
An import is the receiving country in an export from the sending country. Importation and exportation are the defining financial transactions of international trade.
In international trade, the importation and exportation of goods are limited ...
s) minus workers' savings.
Before trying to explain income distribution, Kalecki introduces some behavioural assumptions in his simplified equation of profits. For him, investment is determined by a combination of many factors difficult to explain, which are considered given,
exogenous
In a variety of contexts, exogeny or exogeneity () is the fact of an action or object originating externally. It contrasts with endogeneity or endogeny, the fact of being influenced within a system.
Economics
In an economic model, an exogen ...
. Regarding capitalists' consumption, he considers that a simplified form is the following equation:
That is, capitalists' consumption depends on a fixed part (independent part), the term
, and a proportional share of profits, the term
, which is called the
marginal propensity to consume of the capitalists. If this consumption function is substituted into the profit equation, we have:
Expressed in terms of
, this gives:
The advantage of the above manipulation is that we have reduced the two earnings determinants (capitalists' consumption and investment) to only one (investment).
Income distribution and the constancy of the share of wages
Income distribution is the other pillar of Kalecki's efforts to build a business cycle theory. To do this, Kalecki assumes that industries compete in
imperfectly competitive markets, more particularly in
oligopolistic markets where firms set a
mark-up on their variable average costs (raw materials, wages of employees on the shop floor that are supposed to be variable) in order to cover their
overhead costs (salaries to senior management and administration), to obtain a certain amount of profit. The mark-up fixed by firms is higher or lower depending on the degree of
monopoly
A monopoly (from Greek language, Greek el, μόνος, mónos, single, alone, label=none and el, πωλεῖν, pōleîn, to sell, label=none), as described by Irving Fisher, is a market with the "absence of competition", creating a situati ...
, or the ease with which firms can raise price without causing reduction in the quantity demanded.
This can be summarized in the following equation:
where
and
are profits and wages,
is the average mark-up for the whole economy,
is the cost of raw materials and
is the total amount of salaries (which must be distinguished from wages, represented by variables, while salaries are considered fixed). The equation allows us to derive the wage share in the
national income
A variety of measures of national income and output are used in economics to estimate total economic activity in a country or region, including gross domestic product (GDP), gross national product (GNP), net national income (NNI), and adjusted nat ...
. If we add to both members
, and pass one to the other side, we have:
If we multiply each side by
, and pass to the other term, we have:
or:
where
is the wage share in the national income and
is the relation between the cost of raw materials and wages. It follows that the wage share in the national income depends negatively on mark-up and on the relationship of raw material costs to wages.
At this point Kalecki's interest is in finding out what happens to the wage share during the business cycle. During
recession
In economics, a recession is a business cycle contraction when there is a general decline in economic activity. Recessions generally occur when there is a widespread drop in spending (an adverse demand shock). This may be triggered by various ...
s, firms collaborate among themselves to cope with the fall of profits, so the degree of monopoly increases and this increases the mark-up. The
parameter goes up. Nonetheless, the lack of demand during recessions causes a fall in the price of raw materials, so the
parameter goes down. The argument is symmetrical during the
boom
Boom may refer to:
Objects
* Boom (containment), a temporary floating barrier used to contain an oil spill
* Boom (navigational barrier), an obstacle used to control or block marine navigation
* Boom (sailing), a sailboat part
* Boom (windsurfin ...
: prices of raw materials rise (
parameter increases) while the strength of unions due to increased employment level causes the degree of monopoly and thereby the mark-up level, to fall. The conclusion is that the α parameter is roughly constant over the business cycle.
Finally, we need an equation that determines the total product of an economy:
which is to say that the share of profits and salaries are the complement of the share of wages. Solving for
gives:
Now we have the three components necessary to determine total product: an equation of profits, a theory of income distribution and an equation that links the product with profits and income distribution. It remains only to substitute the expression for
which we obtained before:
The preceding equation shows the determination of income in a closed system without public sector. It shows that output is completely determined by investment. How will output change from one period to the next? Insofar as we have assumed that
and
are constants, the above formula comes down to the
multiplier:
The problem of the change in output and hence the business cycle is therefore due to changes in the volume of investment. It follows that it is in investment where we must find the reasons for the fluctuations of a capitalist economy.
Determinants of investment
The above argument demonstrates the crucial role played by investment in a capitalist system. Finding a well-specified
investment function would facilitate resolution of many problems in the capitalist economy. This subject had been treated for an extended period by Kalecki, and he was never completely satisfied with his solutions. This is because the factors that determine investment decisions are multiple and not always clear.
What follows is the solution Kalecki gave in one of his books.
Kalecki's investment function in the study of business cycles is the following:
where
is the amount of investment decisions in
fixed capital
In accounting, fixed capital is any kind of real, physical asset that is used repeatedly in the production of a product. In economics, fixed capital is a type of capital good that as a real, physical asset is used as a means of production which ...
,
,
and
are parameters that specify a
linear
Linearity is the property of a mathematical relationship ('' function'') that can be graphically represented as a straight line. Linearity is closely related to '' proportionality''. Examples in physics include rectilinear motion, the linear ...
relation,
is a constant which can vary in the long-run,
are profits,
is the gross saving generated by the firm, and
is the stock of fixed capital. The equation shows that investment decisions depend positively on savings generated by the firm, the rate of change of profits, a constant which is subject to long-term changes, and negatively on the increase of fixed capital.
The above equation is able to generate cycles by itself. During booms, firms are able to generate more
cash flow
A cash flow is a real or virtual movement of money:
*a cash flow in its narrow sense is a payment (in a currency), especially from one central bank account to another; the term 'cash flow' is mostly used to describe payments that are expected ...
and enjoy increases in profits. However, the increase in orders for capital investment increases the stock of capital, until it becomes unprofitable to make more investments. Ultimately, the variations in the level of investment generate the business cycles. As Kalecki would say:
Influence
In the first half of the 1990s,
Oxford University Press
Oxford University Press (OUP) is the university press of the University of Oxford. It is the largest university press in the world, and its printing history dates back to the 1480s. Having been officially granted the legal right to print book ...
published 7 volumes of ''Collected Works of Michal Kalecki'', referring to him as "one of the most distinguished economists of the 20th century." Many of his works were translated into English for the first time in this collection.
Kalecki's work has inspired the Cambridge (UK)
post-Keynesians, especially
Joan Robinson
Joan Violet Robinson (''née'' Maurice; 31 October 1903 – 5 August 1983) was a British economist well known for her wide-ranging contributions to economic theory. She was a central figure in what became known as post-Keynesian economics.
...
,
Nicholas Kaldor
Nicholas Kaldor, Baron Kaldor (12 May 1908 – 30 September 1986), born Káldor Miklós, was a Cambridge economist in the post-war period. He developed the "compensation" criteria called Kaldor–Hicks efficiency for welfare comparisons (1939), ...
and
Richard M. Goodwin, as well as the modern American post-Keynesian economists.
Publications
In Polish
* ''Próba teorii koniunktury'' (1933)
* ''Szacunek dochodu społecznego w roku 1929'' (1934, with Ludwik Landau)
* ''Dochód społeczny w roku 1933 i podstawy badań periodycznych nad zmianami dochodu'' (1935, with Ludwik Landau)
* ''Teoría cyklu koniunkturalnego'' (1935)
* ''Płace nominalne i realne'' (1939)
* ''Teoría dynamiki gospodarczej'' (1958)
* ''Zagadnienia finansowania rozwoju ekonomicznego'' (1959, in: ''Problemy wzrostu ekonomicznego krajów słabo rozwiniętych'', edited by Ignacy Sachs and Jerzy Zdanowicz)
* ''Uogólnienie wzoru efektywności inwestycji'' (1959, with Mieczysław Rakowski)
* ''Polityczne aspekty pełnego zatrudnienia'' (1961)
* ''O podstawowych zasadach planowania wieloletniego'' (1963)
* ''Zarys teorii wzrostu gospodarki socjalistycznej'' (1963)
* ''Model ekonomiczny a materialistyczne pojmowanie dziejów'' (1964)
* ''Dzieła'' (1979–1980, 2 volumes)
In English
* ''Mr Keynes's Predictions'', 1932, ''Przegląd Socjalistyczny''.
* ''An Essay on the Theory of the Business Cycle'' ('Próba teorii koniunktury'), 1933.
* ''On foreign trade and domestic exports'', 1933, ''Ekonomista''.
* ''A Macrodynamic Theory of Business Cycles'', 1935, ''Econometrica''.
* ''The Mechanism of Business Upswing'' ('El mecanismo del auge económico'), 1935, ''Polska Gospodarcza''.
* ''Business upswing and the balance of payments'' ('El auge económico y la balanza de pagos'), 1935, ''Polska Gospodarcza''.
* ''Some Remarks on Keynes's Theory'', 1936, ''Ekonomista''.
* ''A Theory of the Business Cycle'', 1937, ''Review of Economic Studies''.
* ''A Theory of Commodity, Income and Capital Taxation'', 1937, ''Economic Journal''.
* ''The Principle of Increasing Risk'', 1937, ''Económica''.
* ''The Determinants of Distribution of the National Income'', 1938, ''Econometrica''.
* ''Essays in the Theory of Economic Fluctuations'', 1939.
* ''A Theory of Profits'', 1942, ''Economic Journal''.
* ''Studies in Economic Dynamics'', 1943.
'Political Aspects of Full Employment'', 1943, ''Political Quarterly''].
* ''Economic Implications of the Beveridge Plan'' (1943)
* ''Professor Pigou on the Classical Stationary State'', 1944, ''Economic Journal''.
* ''Three Ways to Full Employment'', 1944 in ''Economics of Full Employment''.
* ''On the Gibrat Distribution'', 1945, ''Econometrica''.
* ''A Note on Long Run Unemployment'', 1950, ''Review of Economic Studies''.
* ''Theory of Economic Dynamics: An Essay on Cyclical and Long-Run Changes in Capitalist Economy'', 1954. 1965 reprint.
* ''Observations on the Theory of Growth'', 1962, ''Economic Journal''.
* ''Studies in the Theory of Business Cycles, 1933–1939'', 1966.
* ''The Problem of Effective Demand with Tugan-Baranovski and Rosa Luxemburg'', 1967, ''Ekonomista''.
* ''The Marxian Equations of Reproduction and Modern Economics'', 1968, ''Social Science Information''.
* ''Trend and the Business Cycles Reconsidered'', 1968, ''Economic Journal''.
* ''Class Struggle and the Distribution of National Income'' ('Lucha de y distribución del ingreso'), 1971, ''Kyklos''.
* ''Selected Essays on the Dynamics of the Capitalist Economy'', 1933–1970, 1971.
* ''Selected Essays on the Economic Growth of the Socialist and the Mixed Economy'', 1972.
* ''The Last Phase in the Transformation of Capitalism'', 1972.
* ''Essays on Developing Economies'', 1976.
* ''Collected Works of Michał Kalecki'' (seven volumes), Oxford University Press, 1990–1997.
In Spanish
* ''Teoría de la dinámica económica: ensayo sobre los movimientos cíclicos y a largo plazo de la economía capitalista'', Fondo de Cultura Económica, 1956
* ''El Desarrollo de la Economía Socialista'', Fondo de Cultura Económica, 1968
* ''Estudios sobre la Teoría de los Ciclos Económicos'', Ariel, 1970
* ''Economía socialista y mixta: selección de ensayos sobre crecimiento económico'', Fondo de Cultura Económica, 1976
* ''Ensayos escogidos sobre dinámica de la economía capitalista 1933–1970'', Fondo de Cultura Económica, 1977
* ''Ensayos sobre las economías en vías de desarrollo'', Crítica, 1980
In French
* ''Essai d'une theorie du mouvement cyclique des affaires'', 1935, ''Revue d'economie politique''.
See also
*
Neo-Ricardianism
*
Cost-of-production theory of value
*
List of Poles
Notes
''a.'' British economist Jan Toporowski spoke of "the inability of capitalism to secure the rational use of resources because of the blocking political, social and financial power of the
capitalist class
The bourgeoisie ( , ) is a social class, equivalent to the middle or upper middle class. They are distinguished from, and traditionally contrasted with, the proletariat by their affluence, and their great cultural and financial capital. They ...
", a phenomenon expounded by Kalecki in carefully reasoned analysis, without resorting to the presently commonly practiced accusations of partiality, injustice or bad faith.
''b.''According to Toporowski, the economic profession is now divided into
schools of thought which identify themselves with
doctrine
Doctrine (from la, doctrina, meaning "teaching, instruction") is a codification of beliefs or a body of teachings or instructions, taught principles or positions, as the essence of teachings in a given branch of knowledge or in a belief syste ...
s, sets of ''a priori'' principles they do not question. Toporowski said that in the 21st century we urgently need to recover Kalecki's concepts and the rule of the
circular flow of income as an integrating factor of
macroeconomic
Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole.
For example, using interest rates, taxes, an ...
analysis. Lacking these, the economists have regressed toward
Victorian values that praise the supposed virtue of thrift of the wealthy. We must return to the vision of Kalecki and
Oskar Lange regarding economic development of traditional societies, vision that stressed the role of such development as changing social structures, not as just augmenting the potential of individuals.
References
Sources
*
Dobb, Maurice (1973). ''Theories of value and distribution since Adam Smith''. Cambridge University Press.
* Feiwel, George R. (1975). ''The Intellectual Capital of Michal Kalecki: A Study in Economic Theory and Policy''. Fondo de Cultura Económica, México.
* Kalecki, M. (2009) ''Theory of Economic Dynamics: An Essay on Cyclical and Long-Run Changes in Capitalist Economy'', Monthly Review Press.
* Kalecki, M. ''Collected Works of Michal Kalecki'', Oxford University Press.
* Kalecki, M. (1971) ''Selected essays on the dynamics of the capitalist economy'', Cambridge University Press.
Further reading
*
*
*
*
Vianello, Fernando 989
Year 989 ( CMLXXXIX) was a common year starting on Tuesday (link will display the full calendar) of the Julian calendar.
Events
By place
Byzantine Empire
* Emperor Basil II uses his contingent of 6,000 Varangians to help him defeat ...
"Effective Demand and the Rate of Profits: Some Thoughts on Marx, Kalecki and Sraffa", in: Sebastiani, M. (ed.), ''Kalecki's Relevance Today'', London, Macmillan, .
External links
Alberto Chilosi "Kalecki's Theory of Income Determination: A Reconstruction and an Assessment"Julio López G. and Michaël Assous"Michal Kalecki"Theory of Economic Dynamics– ''
Monthly Review
The ''Monthly Review'', established in 1949, is an independent socialist magazine published monthly in New York City. The publication is the longest continuously published socialist magazine in the United States.
History Establishment
Following ...
''
Kalecki's pricing and distribution theory F.M. Rugitsky
{{DEFAULTSORT:Kalecki, Michal
1899 births
1970 deaths
20th-century Polish economists
Fellows of the Econometric Society
Gdańsk University of Technology alumni
Jewish socialists
Marxian economists
Post-Keynesian economists
Recipients of the State Award Badge (Poland)
Writers from Łódź