Kaldor’s Macro System: Too Much Cumulation, Too Few Contradictions

The late Lord Nicholas Kaldor made seminal and pivotal contributions to our understanding of the sources and character of trend and cycle in advanced capitalist countries. And yet we still lack a firm basis for evaluating the relative usefulness or explanatory power of Kaldor’s ideas. This paper attempts to provide one foundation for such an evaluation, constructing and evaluating the properties of a macroeconometric model of the US economy which embodies the central features of Kaldor’s macro system.