The Irreversibility Of Consumption And Economic Growth

The thesis put forward in a previous paper by P. Garegnani and the author is here scrutinized in detail. In advanced capitalist economies the asymmetry of aggregate consumption, which decreases to a lesser extent during recessions than it increases during expansions, implies an endogenous source of growth and accumulation. The analysis is developed here in terms of different numerical and graphical examples. The connection with similar assumptions on consumption to be found in the literature is also examined and some implications of the hypothesis in relation to the meaning of the proportion of saving in income are pointed out.