Cooperation vs. Solidarity in a Complete Version of the Classical Growth Cycle

Abstract

Goodwin’s [1967] model of a growth cycle has since long been regarded as a model of class struggle and the conflict over income distribution which mirrors basic aspects of Marx’s ‘General Law of Capitalist Accumulation’ in Volume I of ‘Das Kapital’. When rereading this chapter [Marx 1954, Ch. 25] with Goodwin’s model and its various extensions in mind, one indeed finds many observations of Marx — in particular in its section 1 — which are strikingly similar to the assumptions and conclusions which this growth cycle model exhibits. However, Marx also very often stresses aspects of the behavior of ‘capital’ which are not covered by this approach to cyclical growth (where profits are more or less mechanically invested by ‘capitalists’). These aspects typically concern the strategic possibilities of capitalists when faced with the profit squeeze mechanism due to a low number of unemployed workers in the reserve army.