Revisiting ?New Cambridge?: The Three Financial Balances In A General Stock-flow Consistent Applied Modeling Strategy
Source: Levy Economics Institute
This paper argues that modified versions of the so-called "New Cambridge" approach to macroeconomic modeling are both quite useful for modeling real capitalist economies in historical time and perfectly compatible with the "Vision" underlying modern Post-Keynesian stock-flow consistent macroeconomic models. As such, New Cambridge - type models appear to the authors as an important contribution to the tool kit available to applied macroeconomists in general and to heterodox applied macroeconomists in particular. Their main contention in this paper is that modified versions of the so-called "New Cambridge" approach to macroeconomic modeling.