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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 The London School of Economics and Political Science (LSE), established in 1895, is a public research university in London, England, and a member institution of the University of London. The school specialises in the social sciences. Founded ...
,
University of Cambridge The University of Cambridge is a Public university, public collegiate university, collegiate research university in Cambridge, England. Founded in 1209, the University of Cambridge is the List of oldest universities in continuous operation, wo ...
,
University of Oxford The University of Oxford is a collegiate university, collegiate research university in Oxford, England. There is evidence of teaching as early as 1096, making it the oldest university in the English-speaking world and the List of oldest un ...
, and Warsaw School of Economics, and was an economic advisor to the governments of Poland, France, Cuba, Israel, Mexico, and India. 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 and philosopher whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments. Originall ...
before Keynes but remains much less known to the English-speaking world. He offered a synthesis that integrated class analysis of
Marxism Marxism is a political philosophy and method of socioeconomic analysis. It uses a dialectical and materialist interpretation of historical development, better known as historical materialism, to analyse class relations, social conflict, ...
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 Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. This includes regional, national, and global economies. Macroeconomists study topics such as output/ GDP ...
to apply
mathematical model A mathematical model is an abstract and concrete, abstract description of a concrete system using mathematics, mathematical concepts and language of mathematics, language. The process of developing a mathematical model is termed ''mathematical m ...
s and
statistical data Statistics (from German: ', "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, industrial, or socia ...
to economic questions. Being also a political economist and a person of left-wing convictions, Kalecki emphasized the social 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 general expansion followed by recession in economic performance. The changes in economic activity that characterize business cycles have important implications for the welfare of the general population, governmen ...
, economic growth,
full employment Full employment is an economic 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 ...
,
income distribution In economics, income distribution covers how a country's total GDP is distributed amongst its population. Economic theory and economic policy have long seen income and its distribution as a central concern. Unequal distribution of income causes e ...
, 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 environ ...
. 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: med ...
issues,
economic development In economics, economic development (or 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 object ...
, finance, interest, and inflation. 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 (), commonly referred to as the Nobel Prize in Economics(), is an award in the field of economic sciences adminis ...
but died the same year.


Biography


Early years: 1899–1933

Michał Kalecki was born on 22 June 1899 in
Łódź Łódź is a city in central Poland and a former industrial centre. It is the capital of Łódź Voivodeship, and is located south-west of Warsaw. Łódź has a population of 655,279, making it the country's List of cities and towns in Polan ...
,
Congress Poland Congress Poland or Congress Kingdom of 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. It was established w ...
, then part of the
Russian Empire The Russian Empire was an empire that spanned most of northern Eurasia from its establishment in November 1721 until the proclamation of the Russian Republic in September 1917. At its height in the late 19th century, it covered about , roughl ...
, to a middle-class Jewish family. Information about his early years is very sparse, part of it being lost during the Nazi occupation. He grew up in a major labor-turbulent industrial center, which affected his future views. In 1917 Kalecki enrolled at the Warsaw Polytechnic to study
civil engineering Civil engineering is a regulation and licensure in engineering, professional engineering discipline that deals with the design, construction, and maintenance of the physical and naturally built environment, including public works such as roads ...
. 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 is de ...
drawn within a second-degree curve: Kalecki generalized it for a
polygon In geometry, a polygon () is a plane figure made up of line segments connected to form a closed polygonal chain. The segments of a closed polygonal chain are called its '' edges'' or ''sides''. The points where two edges meet are the polygon ...
of 2n sides. Because his father lost a small textile workshop, Kalecki was forced to work as an accountant. During his first year in
Warsaw Warsaw, officially the Capital City of Warsaw, is the capital and List of cities and towns in Poland, largest city of Poland. The metropolis stands on the Vistula, River Vistula in east-central Poland. Its population is officially estimated at ...
he continued working sporadically and precariously. After finishing his first year of engineering studies, 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 Mikhail Tugan-Baranovsky (; ; January 20, 1865 - January 21, 1919) was a Russian and Ukrainian Marxism, Marxist, economist, and politician. He was a leading exponent of Legal Marxism in the Russian Empire and was the author of numerous works dea ...
and
Rosa Luxemburg Rosa Luxemburg ( ; ; ; born Rozalia Luksenburg; 5 March 1871 – 15 January 1919) was a Polish and naturalised-German revolutionary and Marxist theorist. She was a key figure of the socialist movements in Poland and Germany in the early 20t ...
. 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 language, German: ', "description of a State (polity), state, a country") is the discipline that concerns the collection, organization, analysis, interpretation, and presentation of data. In applying statistics to a s ...
. He stayed there for seven years. On 18 June 1930, Kalecki 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 general expansion followed by recession in economic performance. The changes in economic activity that characterize business cycles have important implications for the welfare of the general population, governmen ...
s. The foundations of his
macroeconomic Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. This includes regional, national, and global economies. Macroeconomists study topics such as output/ GDP ...
theory of
effective demand Effectiveness or effectivity is the capability of producing a desired result or the ability to produce desired output. When something is deemed effective, it means it has an intended or expected outcome, or produces a deep, vivid impression. Et ...
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 and philosopher whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments. Originall ...
in ''
The General Theory of Employment, Interest and Money ''The General Theory of Employment, Interest and Money'' is a book by English economist John Maynard Keynes published in February 1936. It caused a profound shift in economic thought, giving macroeconomics a central place in economic theory and ...
''. According to
Lawrence Klein Lawrence Robert Klein (September 14, 1920 – October 20, 2013) was an American economist. For his work in creating computer models to forecast economic trends in the field of econometrics in the Department of Economics at the University of Penn ...
(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 ( Maurice; 31 October 1903 – 5 August 1983) was a British economist known for her wide-ranging contributions to economic theory. One of the most prominent economists of the century, Robinson incarnated the "Cambridge Sc ...
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 econometricians) 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 language, English and Archaism, archaic Dutch language, Dutch also Leyden) is a List of cities in the Netherlands by province, city and List of municipalities of the Netherlands, municipality in the Provinces of the Nethe ...
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 and econometrician known for being one of the major contributors to establishing economics as a quantitative and statistically informed science ...
and
Jan Tinbergen Jan Tinbergen ( , ; 12 April 1903 – 9 June 1994) was a Dutch economist who was awarded the first Nobel Memorial Prize in Economic Sciences in 1969, which he shared with Ragnar Frisch for having developed and applied dynamic models for the ana ...
. 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 philanthropic medical research and arts funding organization based at 420 Fifth Avenue, New York City. The foundation was created by Standard Oil magnate John D. Rockefeller (" ...
's Traveling Fellowship, proceeded to work abroad. The scholarship enabled Kalecki to travel with his wife to
Sweden Sweden, formally the Kingdom of Sweden, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. It borders Norway to the west and north, and Finland to the east. At , Sweden is the largest Nordic count ...
, where followers of
Knut Wicksell Johan Gustaf Knut Wicksell (December 20, 1851 – May 3, 1926) was a Swedish economist of the Stockholm school. He was professor at Uppsala University and Lund University. He made contributions to theories of population, value, capital and mon ...
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 Countries of the United Kingdom, country that is part of the United Kingdom. It is located on the island of Great Britain, of which it covers about 62%, and List of islands of England, more than 100 smaller adjacent islands. It ...
. He first visited the
London School of Economics The London School of Economics and Political Science (LSE), established in 1895, is a public research university in London, England, and a member institution of the University of London. The school specialises in the social sciences. Founded ...
and afterward went to
Cambridge Cambridge ( ) is a List of cities in the United Kingdom, city and non-metropolitan district in the county of Cambridgeshire, England. It is the county town of Cambridgeshire and is located on the River Cam, north of London. As of the 2021 Unit ...
. Thus began his friendships with Richard Kahn, Joan Robinson and
Piero Sraffa Piero Sraffa Fellow of the British Academy, FBA (5 August 1898 – 3 September 1983) was an influential Italian Political economy, political economist who served as lecturer of economics at the University of Cambridge. His book ''Production of Co ...
, 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 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 an economic 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 ...
delivered by Keynesian policy would eventually lead to a more assertive
working class The working class is a subset of employees who are compensated with wage or salary-based contracts, whose exact membership varies from definition to definition. Members of the working class rely primarily upon earnings from wage labour. Most c ...
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 , ) is a type of economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies or regulations). As a system of thought, ''laissez-faire'' ...
'' 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 preparations 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 to su ...
. Occasionally he gave lectures at
Oxford University The University of Oxford is a collegiate research university in Oxford, England. There is evidence of teaching as early as 1096, making it the oldest university in the English-speaking world and the second-oldest continuously operating u ...
. The elaborate reports Kalecki prepared for the government were chiefly about the
rationing Rationing is the controlled distribution (marketing), distribution of scarcity, 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 resourc ...
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 average price of goods and services in terms of money. This increase is measured using a price index, typically a consumer price index (CPI). When the general price level rises, each unit of curre ...
. 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
Paris Paris () is the Capital city, capital and List of communes in France with over 20,000 inhabitants, largest city of France. With an estimated population of 2,048,472 residents in January 2025 in an area of more than , Paris is the List of ci ...
for a while, then moved to
Montreal Montreal is the List of towns in Quebec, largest city in the Provinces and territories of Canada, province of Quebec, the List of the largest municipalities in Canada by population, second-largest in Canada, and the List of North American cit ...
, where he stayed for fifteen months working at the International Labour Office. 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 The United Nations Secretariat is one of the six principal organs of the United Nations (UN), The secretariat is the UN's executive arm. The secretariat has an important role in setting the agenda for the deliberative and decision-making bodi ...
in
New York New York most commonly refers to: * New York (state), a state in the northeastern United States * New York City, the most populous city in the United States, located in the state of New York New York may also refer to: Places United Kingdom * ...
. He remained there until 1955, mainly preparing the World Economic Reports. Kalecki resigned that position as a result of McCarthyist 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 Party (United States), Republican United States Senate, U.S. Senator from the state of Wisconsin from 1947 until his death at age ...
's witch-hunt, as many of his close friends were directly affected. Denounced in the
US Senate The United States Senate is a chamber of the bicameral United States Congress; it is the upper house, with the U.S. House of Representatives being the lower house. Together, the Senate and House have the authority under Article One of the ...
as a supporter of
communism Communism () is a political sociology, sociopolitical, political philosophy, philosophical, and economic ideology, economic ideology within the history of socialism, socialist movement, whose goal is the creation of a communist society, a ...
, 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 ( Maurice; 31 October 1903 – 5 August 1983) was a British economist known for her wide-ranging contributions to economic theory. One of the most prominent economists of the century, Robinson incarnated the "Cambridge Sc ...
.


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 an economic ideology, economic and political philosophy encompassing diverse Economic system, economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes ...
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. 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 (, ) is a public university, public research university in Warsaw, Poland. Established on November 19, 1816, it is the largest institution of higher learning in the country, offering 37 different fields of study as well ...
) and member of the
Polish Academy of Sciences The Polish Academy of Sciences (, 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 of distinguished scholars a ...
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, Taiwan, Japan, South Korea, the Southern Cone, NATO, Western European countries and oth ...
, 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 A series of major student, intellectual and other protests against the ruling Polish United Workers' Party of the Polish People's Republic took place in Poland in March 1968. The crisis led to the suppression of student strikes by security forces ...
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 a field of study that discovers and organizes methods, Mathematical theory, theories and theorems that are developed and Mathematical proof, proved for the needs of empirical sciences and mathematics itself. There are many ar ...
. 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 is a branch of pure mathematics devoted primarily to the study of the integers and arithmetic functions. Number theorists study prime numbers as well as the properties of mathematical objects constructed from integers (for example ...
and
probability Probability is a branch of mathematics and statistics concerning events and numerical descriptions of how likely they are to occur. The probability of an event is a number between 0 and 1; the larger the probability, the more likely an e ...
. 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 ''Economic Policy'' is a quarterly peer-reviewed academic journal published by Oxford University Press, Oxford Academic on behalf of the Centre for Economic Policy Research, the Center for Economic Studies (University of Munich), and the Paris Scho ...
.


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 Jan Tinbergen ( , ; 12 April 1903 – 9 June 1994) was a Dutch economist who was awarded the first Nobel Memorial Prize in Economic Sciences in 1969, which he shared with Ragnar Frisch for having developed and applied dynamic models for the ana ...
's
econometric Econometrics is an application of statistical methods to economic data in order to give empirical content to economic relationships. M. Hashem Pesaran (1987). "Econometrics", '' The New Palgrave: A Dictionary of Economics'', v. 2, p. 8 p. 8� ...
business cycle Business cycles are intervals of general expansion followed by recession in economic performance. The changes in economic activity that characterize business cycles have important implications for the welfare of the general population, governmen ...
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 In economics, economic growth is an increase in the quantity and quality of the economic goods and Service (economics), services that a society Production (economics), produces. It can be measured as the increase in the inflation-adjusted Outp ...
models were built on the assumption of an idealized ''
laissez-faire ''Laissez-faire'' ( , from , ) is a type of economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies or regulations). As a system of thought, ''laissez-faire'' ...
'' 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 The circular flow of income or circular flow is a economic model, model of the economy in which the major exchanges are represented as flows of money, Good (economics), goods and Service (economics), services, etc. between economic agents. The f ...
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. They believed that the wealth of nations derived solely from the value of "land agricultu ...
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 the economic forces of supply and demand are balanced, meaning that economic variables will no longer change. Market equilibrium in this case is a condition where a market price is es ...
) are determined foremost by the magnitude of
investment Investment is traditionally defined as the "commitment of resources into something expected to gain value over time". If an investment involves money, then it can be defined as a "commitment of money to receive more money later". From a broade ...
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 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 Swedish economist of the Stockholm school. He was professor at Uppsala University and Lund University. He made contributions to theories of population, value, capital and mon ...
. Quesnay's circular flow of income fell into disrepute in the
political economy Political or comparative economy is a branch of political science and economics studying economic systems (e.g. Marketplace, markets and national economies) and their governance by political systems (e.g. law, institutions, and government). Wi ...
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 political economist. He served briefly as Finance Minister of Austria in 1919. In 1932, he emigrated to the United States to become a professor at Harvard Unive ...
, who pointed out the necessity of considering the circular flow of income (recognition of the
economic cycle Business cycles are intervals of general Economic expansion, expansion followed by recession in economic performance. The changes in economic activity that characterize business cycles have important implications for the welfare of the general po ...
) 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 is a political and economic ideology that advocates for free-market capitalism, which became dominant in policy-making from the late 20th century onward. The term has multiple, competing definitions, and is most often used pej ...
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 ov ...
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: med ...
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-leve ...
. 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 from profits to wages, and through public investment that increases employment and demand automatically. Kalecki was engaged in the problems of
developing countries A developing country is a sovereign state with a less-developed Secondary sector of the economy, industrial base and a lower Human Development Index (HDI) relative to developed countries. However, this definition is not universally agreed upon. ...
. He argued that their
industrialization Industrialisation (British English, UK) American and British English spelling differences, or industrialization (American English, US) is the period of social and economic change that transforms a human group from an agrarian society into an i ...
depended on
land reform Land reform (also known as agrarian reform) involves the changing of laws, regulations, or customs regarding land ownership, land use, and land transfers. The reforms may be initiated by governments, by interested groups, or by revolution. Lan ...
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 ownership stake in a company, made by a foreign investor, company, or government from another country. More specifically, it describes a controlling ownership an asset in one country by an entity based i ...
in stimulating economic modernization. Polish economist
Oskar Lange Oskar Ryszard Lange (; 27 July 1904 – 2 October 1965) was a Polish economics, economist and diplomat. He is best known for advocating the use of market (economics), market pricing tools in socialism, socialist systems and providing a model of m ...
, who worked with Kalecki also on centrally planned
socialist Socialism is an economic ideology, economic and political philosophy encompassing diverse Economic system, economic and social systems characterised by social ownership of the means of production, as opposed to private ownership. It describes ...
economies of the
Soviet Bloc The Eastern Bloc, also known as the Communist Bloc (Combloc), the Socialist Bloc, the Workers Bloc, and the Soviet Bloc, was an unofficial coalition of communist states of Central and Eastern Europe, Asia, Africa, and Latin America that were a ...
, 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 either as a whole or of certain social hierarchies. Left-wing politi ...
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 Credit (from Latin verb ''credit'', meaning "one believes") is the trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately (thereby generating a debt) ...
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 that accepts deposits from the public and gives loans for the purposes of consumption and investment to make a profit. It can also refer to a bank or a division of a larger bank that deals with whol ...
s and a
central bank A central bank, reserve bank, national bank, or monetary authority is an institution that manages the monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the mo ...
. He saw
monetary policy Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability (normally interpreted as a low and stable rat ...
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 marke ...
s,
microeconomic Microeconomics is a branch of 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 focuses on the ...
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 Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, political theorist, economist, journalist, and revolutionary socialist. He is best-known for the 1848 pamphlet '' The Communist Manifesto'' (written with Friedrich Engels) ...
'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 manufacture it: i.e. the amount raised through sale of the product minus the cost of the materials, plant and ...
or the
organic composition of capital The organic composition of capital (OCC) is a concept created by Karl Marx in his theory of capitalism, which was simultaneously his critique of the political economy of his time. It is derived from his more basic concepts of 'value composition ...
(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, who earn only
wage A wage is payment made by an employer to an employee for work (human activity), work done in a specific period of time. Some examples of wage payments include wiktionary:compensatory, compensatory payments such as ''minimum wage'', ''prevailin ...
s, and
capitalists Capitalism is an economic system based on the private ownership of the means of production and their use for the purpose of obtaining profit. This socioeconomic system has developed historically through several stages and is defined by a n ...
, 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 significan ...
) 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, pu ...
. With these assumptions Kalecki derives the following accounting identity: where P \,\ is the volume of gross profits (profits plus
depreciation In accountancy, depreciation refers to two aspects of the same concept: first, an actual reduction in the fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wears, and second, the allocation i ...
), W \,\ is the volume of total wages, C_P \,\ is capitalists' consumption, C_W \,\ is workers' consumption and I \,\ is the gross investment that has been made in the economy. Since we have supposed workers who do not save (that is W=C_W \,\ 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 (S \,\ ) 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, ...
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
tax A tax is a mandatory financial charge or levy imposed on an individual or legal entity by a governmental organization to support government spending and public expenditures collectively or to regulate and reduce negative externalities. Tax co ...
es 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 importer is the receiving country in an export from the sending country. Importation and exportation are the defining financial transactions of international trade. Import is part of the International Trade which involves buying and receivin ...
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. 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 A \,\ , and a proportional share of profits, the term q \,\ , which is called the
marginal propensity to consume In economics, the marginal propensity to consume (MPC) is a metric that quantifies induced consumption, the concept that the increase in personal consumer spending ( consumption) occurs with an increase in disposable income (income after taxes a ...
of the capitalists. If this consumption function is substituted into the profit equation, we have: Expressed in terms of P \,\ , 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 In economics, income distribution covers how a country's total GDP is distributed amongst its population. Economic theory and economic policy have long seen income and its distribution as a central concern. Unequal distribution of income causes e ...
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 and ) is a market in which one person or company is the only supplier of a particular good or service. A monopoly is characterized by a lack of economic Competition (economics), competition to produce ...
, 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 P\,\ and W\,\ are profits and wages, k\,\ is the average mark-up for the whole economy, M\,\ is the cost of raw materials and B\,\ 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 income (GNI), net national income (NNI), and adjusted nati ...
. If we add to both members W\,\ , and pass one to the other side, we have: If we multiply each side by W\,\ , and pass to the other term, we have: or: where \alpha \,\ is the wage share in the national income and j \,\ 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 that occurs when there is a period of broad decline in economic activity. Recessions generally occur when there is a widespread drop in spending (an adverse demand shock). This may be tr ...
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 k \,\ parameter goes up. Nonetheless, the lack of demand during recessions causes a fall in the price of raw materials, so the j \,\ parameter goes down. The argument is symmetrical during the boom: prices of raw materials rise (j \,\ 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 Y \,\ 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 P \,\ 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 A \,\ and B \,\ 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 D \,\ 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 i ...
, a \,\ , b \,\ and c \,\ are parameters that specify a
linear In mathematics, the term ''linear'' is used in two distinct senses for two different properties: * linearity of a '' function'' (or '' mapping''); * linearity of a '' polynomial''. An example of a linear function is the function defined by f(x) ...
relation, d \,\ is a constant which can vary in the long-run, P \,\ are profits, S \,\ is the gross saving generated by the firm, and K \,\ 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 Cash flow, in general, refers to payments made into or out of a business, project, or financial product. It can also refer more specifically to a real or virtual movement of money. *Cash flow, in its narrow sense, is a payment (in a currency), es ...
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 publishing house of the University of Oxford. It is the largest university press in the world. Its first book was printed in Oxford in 1478, with the Press officially granted the legal right to print books ...
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 ( Maurice; 31 October 1903 – 5 August 1983) was a British economist known for her wide-ranging contributions to economic theory. One of the most prominent economists of the century, Robinson incarnated the "Cambridge Sc ...
,
Nicholas Kaldor Nicholas Kaldor, Baron Kaldor (12 May 1908 – 30 September 1986), born Káldor Miklós, was a Hungarian-born British economist. He developed the "compensation" criteria called Kaldor–Hicks efficiency for welfare spending, welfare comparisons ...
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) * ''Teoria cyklu koniunkturalnego'' (1935) * ''Płace nominalne i realne'' (1939) * ''Teoria 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 In economics, the cost-of-production theory of value is the theory that the price of an object or condition is determined by the sum of the cost of the resources that went into making it. The cost can comprise any of the factors of production (incl ...
*
List of Poles This is a partial list of notable Polish people, Polish or Polish language, Polish-speaking or -writing people. People of partial Polish heritage have their respective ancestries credited. Physics *Miedziak Antal * Czesław Białobrzesk ...


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 ( , ) are a class of business owners, merchants and wealthy people, in general, which emerged in the Late Middle Ages, originally as a "middle class" between the peasantry and aristocracy. They are traditionally contrasted with ...
", 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 , meaning 'teaching, instruction') is a codification (law), codification of beliefs or a body of teacher, teachings or instructions, taught principles or positions, as the essence of teachings in a given branch of knowledge or in a ...
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 The circular flow of income or circular flow is a economic model, model of the economy in which the major exchanges are represented as flows of money, Good (economics), goods and Service (economics), services, etc. between economic agents. The f ...
as an integrating factor of
macroeconomic Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. This includes regional, national, and global economies. Macroeconomists study topics such as output/ GDP ...
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 Oskar Ryszard Lange (; 27 July 1904 – 2 October 1965) was a Polish economics, economist and diplomat. He is best known for advocating the use of market (economics), market pricing tools in socialism, socialist systems and providing a model of m ...
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 of the Julian calendar. Events By place Byzantine Empire * Emperor Basil II uses his contingent of 6,000 Varangians to help him defeat Bardas Phokas (the Younger), who suffe ...
"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'' is an independent socialist magazine published monthly in New York City. Established in 1949, 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 20th-century Polish Jews Fellows of the Econometric Society Gdańsk University of Technology alumni Jewish Polish writers Jewish socialists Marxian economists Post-Keynesian economists Recipients of the State Award Badge (Poland) Writers from Łódź