The paper investigates the relation between effective demand, income distribution and unemployment empirically. Its aim is to evaluate Keynesian, Kaldorian and neoclassical hypotheses about the determination of labor market variables. To do so, a vector autoregression model consisting of capital...

In this study, a Kaleckian-Post-Keynesian macroeconomic model, which is an extended version of the Bhaduri and Marglin (1990) model, serves as the starting point. The merit of a Kaleckian model for our purposes is that it highlights the dual function of wages as a component of aggregate demand...

Distinguishing between profit led and growth led demand regimes, we analyze the conditions of existence and stability of long run equilibrium of unemployment. The model we employ has at its center the relation between growth and distribution. Growth can be either wage led or profit led....