Michal Kalecki Definition Epilogue Book

Michal Kalecki, Ideas For an Epilogue, Definition Epilogue

Following the incorporation of the 'Keynesian Revolution' into the orthodoxy and teaching of economics, many aspects of Kalecki's work, like the multiplier, will seem very familiar, while others will appear very unusual. Taken in their entirety, Kalecki's ideas constitute a complex system whose solutions are very different from those of orthodox theory. Palpably, advanced capitalist economies are characterised by oligopolistic structures and a substantial body of evidence attests to the pervasiveness of mark-up pricing. Kalecki uses these realities to explain both the distribution of income between classes and the level of aggregate production. He also extends from these microfoundations to explanations of the dynamic movements in an economy. He proposes an alternative theory of growth that can also explain the persistent increase in the general level of prices. Within the Kaleckian framework the function of competition policy and its multifarious agencies is not just to protect the weak consumer who lacks countervailing power. Rather its concern is with the distribution of income both between the oligopolistic and competitive sectors of the economy and between the economic classes. In that competition policy affects income distribution it influences the growth of an economy. Why has competition policy in virtually all economies failed? Perhaps this can be answered by returning to one of our original tasks.

Why have Kalecki's ideas not reached a wider audience? True, there have always been pockets of interest, but this is far from a general consideration of a thoroughgoing alternative to the ineffectiveness of current policies.

Perhaps Kalecki himself provides the answer in his important article 'Political Aspects of Full Employment' (1943b). Here it is argued that even if we know how to maintain full employment it will not be a permanent state of affairs. He stresses the con­siderable opposition of business interests to full employment. Capital is conceived of as a coercive social force, rather than mere machines, interested in reproducing the capitalist system, the status quo. He foresaw a 'political business cycle' developing as business interests alternatively gave and withdrew their support for full employment policies. Their interests prevail because they possess certain control mechanisms. Perhaps the most valuable is their domination of economic thinking - often termed 'soundness'. So the ideas that prevail are those of the ruling class.

Kalecki's ideas are a challenge to 'soundness', in both capitalist and socialist countries, and this may explain their limited exposure. It is the hope of the authors that this essay will stimulate its readers to a greater study of Kalecki and that they will use his work to challenge orthodox economic ideas.