In his ‘Comments’, Tom Michl defends the proposal for a fully funded pension scheme based on a saving-led ‘classical growth model’ against my Keynesian contention that a higher saving supply would be deflationary in both the short run and the long run. Michl adds a further argument that an increase in the saving rate associated with a lower interest rate may speed up the accumulation process. I remark that the thesis that a lower interest rate has a positive influence on investment is empirically and theoretically controversial, while the idea that an increase in investment requires a larger saving supply is open to further Keynesian objections.

Cesaratto, S. (2006). A Reply to Michl. CAMBRIDGE JOURNAL OF ECONOMICS, 30, 985-987 [10.1093/cje/bel026].

A Reply to Michl

CESARATTO, SERGIO
2006

Abstract

In his ‘Comments’, Tom Michl defends the proposal for a fully funded pension scheme based on a saving-led ‘classical growth model’ against my Keynesian contention that a higher saving supply would be deflationary in both the short run and the long run. Michl adds a further argument that an increase in the saving rate associated with a lower interest rate may speed up the accumulation process. I remark that the thesis that a lower interest rate has a positive influence on investment is empirically and theoretically controversial, while the idea that an increase in investment requires a larger saving supply is open to further Keynesian objections.
Cesaratto, S. (2006). A Reply to Michl. CAMBRIDGE JOURNAL OF ECONOMICS, 30, 985-987 [10.1093/cje/bel026].
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11365/23578
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