Modern Classical Economics and Reality

1. Front Matter

   Pages i-xi

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2. Old and Modern Classical Economics

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 1-14

3. Modern Classical Theory of Prices and Outputs

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 15-66

4. Values, Prices and Income Distribution in Actual Economies

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 67-128

5. Measures of Production Price-Labour Value Deviation and Production Conditions

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 129-149

6. Spectral Decompositions of Single-Product Economies

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 151-214

7. Bródy’s Stability and Disturbances

   • Theodore Mariolis, Lefteris Tsoulfidis

   Pages 215-236

8. Back Matter

   Pages 237-242

   PDF

This book presents an in-depth, novel, and mathematically rigorous treatment of the modern classical theory of value based on the spectral analysis of the price–profit–wage rate system. The classical theory is also subjected to empirical testing to show its logical consistency and explanatory content with respect to observed phenomena and key economic policy issues related to various multiplier processes. In this context, there is an examination of the trajectories of relative prices when the distributive variables change, both theoretically and empirically, using actual input–output data from a number of quite divers

e economies. It is suggested that the actual economies do not behave like the parable of a one-commodity world of the traditional neoclassical theory, which theorizes the relative scarcities of “goods and production factors” as the fundamental determinants of relative prices and their movement. By contrast, the results of the empirical analysis are fully consistent with the modern classical theory, which makes the intersectoral structure of production and the way in which net output is distributed amongst its claimants the fundamental determinants of price magnitudes. At the same time, however, these results indicate that only a few vertically integrated industries (“industry core” or “hyper-basic industries”) are enough to shape the behaviour of the entire economy in the case of a disturbance. This fact is reduced to the skew distribution of the eigenvalues of the matrices of vertically integrated technical coefficients and reveals that, across countries and over time, the effective dimensions of actual economies are surprisingly low.

 

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• Capital Theory
• Input-Output Analysis
• Modern Classical Theory
• Norm Bounds and Approximations for Price Magnitudes
• Spectral Analysis

• Department of Public Administration, Panteion University of Social and Political Sciences, Athens, Greece

  Theodore Mariolis

• Department of Economics, University of Macedonia , Thessaloniki, Greece

  Lefteris Tsoulfidis

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