An increase in the wage share has contradictory effects on the subaggregates of aggregate demand. Private consumption expenditures ought to increase because wage incomes typically are associated with higher consumption propensities than capital incomes. Investment expenditures ought to be...

Over the past decades, the financial investment of non-financial businesses has been rising, and the accumulation of capital goods has been declining. The first part of the paper offers a novel theory to explain this phenomenon. Financialisation, the shareholder revolution and the development of...

According to the mainstream view, labour market institutions (LMIs) are the key determinants of unemployment in the medium run. The actual empirical explanatory power of measures for labour market institutions, however, has recently been called into question. The Keynesian view holds periods of...

This paper investigates the effects of financialisation and functional income distribution on aggregate demand in the USA by estimating the effects of the increase in rentier income (dividends and interest payments) and housing and financial wealth on consumption and investment. The...