Pasinetti's theorem: A narrow escape, for what was to become an inexhaustible research programme

Abstract

Pasinetti's theorem, first published in The Review of Economic Studies in 1962 ‘rather against the opposition of the then editors of the Review’ has led to the development of nine main research lines branching out into numerous fields of economic analysis. Against this background, the historical, demographic, institutional, financial, micro-economic and even religious perspectives have come under close scrutiny by more than 300 scholars; and it is still very much ‘work in progress’ (as the re-visitation by Piketty in 2014, and Stiglitz et al. in 2017). We reassess here the fragile beginnings of the theorem, often labelled as the New Cambridge Equation; which saw Pasinetti backed by Kaldor and J. Robinson in the 1966 Review of Economic Studies Symposium, against James Meade, Paul Samuelson and Franco Modigliani who formulated their Anti-Pasinetti or Dual Theorem. We suggest that Frank Hahn played an important part by siding with Meade and the MIT economists.