A note on Heterodox Macroeconomics by Blecker and Setterfield

Blecker and Setterfield's new textbook from 2019 presents an updated discussion of heterodox models of growth and distribution. This note clarifies and elaborates on three important issues discussed in the book. First, the text presents mainly one-sectoral and one-technique models, which is a reasonable set-up to keep things simple but not always enough to discuss some controversial issues. Second, continuous substitution is important but not essential for neoclassical growth theory. Third, the popular Goodwin model presented in the text does not produce ‘limit cycles.’

Using non-linear estimation strategies to test an extended version of the Goodwin model on the US economy

There is a growing empirical literature that seeks to determine country growth and demand. One possible shortcoming of those studies is their sensitivity to the estimation strategy, which is linked to the time horizon. A profit-led regime has been found to be the most likely outcome when adopting an aggregative approach, while a wage-led regime is the most likely outcome when utilizing a structural estimation. Another potential weakness is that the empirical approaches adopted are mostly linear. To overcome these criticisms, we adopt wavelet analysis, which allows the decomposition of a time series into short- and long-term components, thereby enabling investigation of whether the growth regime switches over time. This paper tests an extended version of the Goodwin model for the US economy using data from 1967 to 2016. The results show that both the growth and demand regimes are sensitive to time and are profit-led in the short term and wage-led in the long term, thereby confirming Blecker's (2016) insight.

Delay-Induced Bifurcation in High-Order Fractional Goodwin Models with Disparate Orders

In the present paper, we first attempt to investigate the bifurcation for the delayed high-dimensional fractional Goodwin model with different orders. By taking the sum of time delays as a bifurcation parameter, the distribution of the characteristic roots of the linearized system is analyzed and the conditions of Hopf bifurcation are obtained. It is revealed that the model undergoes the Hopf bifurcation when the bifurcation parameter increases and exceeds the critical value. To verify the efficiency of our analytic findings, two simulation examples have been ultimately provided.