Abstract
ABSTRACT Our article on ‘The Sraffian supermultiplier and cycles’ provides evidence that aggregate investment in the post-war US leads the cycle. Summa, Petrini and Texeira's reply shows that only residential investment leads, whereas business investment lags the cycle. Their results could be interpreted to support supermultiplier theory. In this rejoinder, we argue that key problems and questions remain, chief among them excessively strong assumptions. Residential investment cannot plausibly be seen as autonomous, and business investment cannot plausibly be seen as fully induced.
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