Re: demand management

["Forstater, Mathew" <ForstaterM@xxxxxxxx>]

Hi Rakesh -

I think Professor Bhaduri is right and so do many PKians.  For example,
as my colleague Randy Wray points out, Minsky advocated 'high
consumption' ('high investment' is unsustainable for Domar reasons,
etc.).

I have distinguished between generic demand stimulus (what some of my
friends call "Big G Keynesianism") and an approach that believes the
composition of spending is as important as the level or rate of growth
of spending.  In my paper on "Public Employment and Environmental
Sustainability" (JPKE, 2003), I argue that trying to stimulate the
private sector to full employment fails on both economic and
environmental grounds, and that public spending is the preferable route,
but that even the composition of government spending itself is also very
important.  A version of the paper is available as a CFEPS Working Paper
(www.cfeps.org/pubs/wp/wp13).

Best,

Mat