This paper discusses the problem of public debt in the long run. The working premise is that debt has negative effects on growth, mainly because it stimulates consumption spending that ultimately crowds out capital accumulation. Since this is a controversial viewpoint among Keynesian economists,...

This paper corrects an error in Palley (2013) and offers an alternative interpretation of the difference between Cambridge and Kaleckian growth models. Using a Cambridge model with a variable profit share and full utilization of capital, a fiscal transfer from capitalists to workers is shown to...