1KALDORIAN IDEAS IN THE FRAMEWORK OF “OLD ” AND “NEW ” THEORIES OF CYCLICAL GROWTH: AN ASSESSMENT (*) (Provisional draft)

(**) Both authors are members of the Department « Institutions, Organisation and Economic Dynamics » (IODE). 2The purpose of this paper is to offer an assessment of the importance of the role played by kaldorian ideas in the framework of both “old ” and “new ” theories of cyclical growth. Kaldor’s contribution to the theory of business cycles (BC) is far from being negligible. A large part of it is mainly critical and concerned the main various versions of the BC models of the thirties, forties and fifties. Hawtrey’s economic theory provided the first target of Kaldor’s reflections: Kaldor showed how the consequences of Hawtrey’s distinction between short-term and long-term investments were underestimated and had to be faced systematically (Kaldor, 1938). Kaldor also devoted three articles (Kaldor, 1939, 1940a, 1942) to the critique of Hayek’s theory of BC, pointing out some of the shortcomings of the Austrian theory of capital. In the beginning of the forties, Kaldor modified Pigou’s macroeconomic model in Employment and equilibrium, showing how these changes could affect its ability to prove the existence of a persistent tendency of the economic towards a long-period equilibrium (Kaldor, 1941). After the war, he finally criticised Hick’s model of the trade cycle and especially its treatment of expectations (Kaldor, 1951). Kaldor’s contribution to BC theor