Will Secular Stagnation be the Result of Great Recession

Özgür ÜŞENMEZ, Levent DUMAN

Abstract


Abstract. While Keynesian and neo-liberal discussions on the reasons of and solutions to the last financial crisis have persisted to the present day, new argument from Lawrence Summers and Paul Krugman in late 2013 shifted the debate to the issue of secular stagnation. Opposed to the neo-liberal haplessness regarding a parsimonious analysis of the events of recent years in global economy, Keynesians argued that falling private investment across the advanced economies was the most alarming development that can pave the way for secular stagnation. In this paper, after looking at the main tenets of the above mentioned discussion we will contest the explanations of both strands of political economy, at the same time we will suggest that critical Marxist arguments, especially on falling rate of profit, have been increasingly relevant to this discussion.

Keywords. Recession, Stagnation, Political economy, Keynesians, Marxists.

JEL. B00, B24.


Keywords


Recession; Stagnation; Political economy; Keynesians; Marxists.

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DOI: http://dx.doi.org/10.1453/jepe.v4i2.1300

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