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This paper shows how cumulative causation supports Kaldor's main policy proposals. Kaldor advocated an expenditure tax to encourage savings, which would lead to technological advancement, productivity growth, income growth, and more savings. Second, Kaldor argued that tax policy should favor the manufacturing sector. Because productivity growth is greater there, this would lead to greater aggregate productivity growth and income growth, which increases the demand for manufactured goods and leads to a virtuous cycle of growth and improved living standards. Finally, Kaldor used cumulative causation arguments against monetarism and to support an incomes policy to stop the inflationary wage-price spiral. Keywords: cumulative causation, policy, expenditures, growth JEL Classification Codes: B52, E11, E12, E64, 043, Kaldor and his Theory of Cumulative Causation Kaldor was born in Budapest, Hungary in 1908. In 1925, he went to the Humboldt University of Berlin to study political economy because [...]

A large and vibrant middle class is important to every nation. It contributes to economic growth, as well as to social and political stability. The middle class helps mitigate class [...]

For institutionalists, behavior depends on the habits, routines, and customs of economic actors. Habits, routines, and customs are how actors make decisions. They are matters of law and tradition, and [...]

It is well known that women are much more likely to be poor than men. This is true in the United States (Pearce 1978; Pressman 1988) and in most developed [...]

As economies throughout the world experience large and wrenching changes, poverty has increasingly become a problem in country after country. This is true regardless of whether these changes result from [...]

For many decades, the disciplines of economics and sociology have been at odds with each other. Economists have looked down on sociology for lacking mathematical rigor; on the other hand, [...]

For many decades, the disciplines of economics and sociology have been at odds with each other. Economists have looked down on sociology for lacking mathematical rigor; on the other hand, [...]

By Andrea H. Beller and John W. Graham. New Haven: Yale University Press, 1993. Pp. 338. American children are mired in poverty. Child poverty has risen dramatically since the late [...]

Half a century ago, Gunnar Myrdal's An American Dilemma [1944] was published. This paper attempts to assess the arguments and the policy solutions of this classic work on the economic [...]

In a recent issue of this journal, Louis-Philippe Rochon (1999) compares three distinct approaches to money creation--the neoclassical view, the Post Keynesian view, and the circuit approach. Through this juxtaposition [...]