Economics: Current and Future Developments

Economics: Current and Future Developments

Volume: 2

Pluralist Readings in Economics: Key Concepts and Policy Tools for the 21st Century

The era of globalization has brought about unprecedented social, political, and environmental challenges for policy makers around the world due to the global impact of economic decisions. In view of ...
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Growth and Economic Cycles

Pp. 78-98 (21)

Maria Alejandra Madi

Abstract

This chapter explores the foundations of some theories about economic growth and business cycles by surveying influential works of political economy. Firstly, we examine Adam Smith’s contribution to the study of the impacts of the division and the specialization of labour on productivity and economic growth in the context of free markets. Then, we present the contribution of Joseph Schumpeter to the capitalist development based on cyclical innovations as structural changes in a longterm process of creative destruction. Finally, we consider the more recent writings of Hyman Minsky that examined the real-world of financial institutions and studied issues connected with growth, business cycles and financial institutions.

Keywords:

Labour productivity, Innovative entrepreneurs, Financial fragility.

Affiliation:

World Economics Association, State University of Campinas, Av. Angélica 1711, cj. 111, São Paulo, SP, Brazil