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Income Distribution and Borrowing: Growth and Financial Balances in the US Economy

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The Financial Crisis

Abstract

According to the more widespread interpretations of the economic and financial crisis which started in 2007, its origin is either due to an exogenous shock which could occur with low probability, or to some kind of misbehaviour in the conduct of monetary policy, or to the misbehaviour of unregulated financial markets. Accordingly, the problems which generated the crisis can be fixed in the medium term by a more stringent regulation of those segments of financial markets which misbehaved, and by a return to the Taylor rule for managing monetary policy. All measures which have been undertaken to sustain the economy in the short run, such as injections of liquidity in financial markets and fiscal expansion, are seen as potentially harmful in the medium term, requiring — sooner rather than later — a change in policy to eliminate the threat of inflation and to reduce public debt.

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Authors
  1. Gennaro Zezza
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Editor information

Editors and Affiliations

  1. Cambridge Centre for Economics and Public Policy, Department of Land Economy, University of Cambridge, UK

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  2. Department of Applied Economics V, Universidad del País Vasco, Spain

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  3. Department of Economics, University of Utah, USA

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  4. Levy Economics Institute, New York, USA

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  5. Leeds Business School, University of Leeds, UK

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  6. Department of Finance and Management Studies, School of Oriental and African Studies (SOAS), University of London, UK

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  7. UK Government Economic Service (GES) on Professional Developments in Economics, UK

    Philip Arestis (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser) (Professor of Economics, Distinguished Adjunct Professor of Economics, Senior Scholar, Visiting Professor, Professorial Research Associate, British Hispanic Foundation ‘Queen Victoria Eugenia’ British Hispanic Chair of Doctoral Studies and Chief Academic Adviser)

  8. Brazilian School of Public and Business Administration, Getulio Vargas Foundation and CNPq Researcher, Brazil

    Rogério Sobreira (Associate Professor of Economics and Finance) (Associate Professor of Economics and Finance)

  9. University of Brasilia (UnB), Brazil

    José Luis Oreiro (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board) (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board)

  10. National Scientific Council (CNPq), Brazil

    José Luis Oreiro (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board) (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board)

  11. Brazilian Keynesian Association (AKB), Brazil

    José Luis Oreiro (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board) (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board)

  12. Brazilian Journal of Political Economy (REP), Brazil

    José Luis Oreiro (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board) (Associate Professor of Economics, Level I Researcher, Director and member of the Editorial Board)

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© 2011 Gennaro Zezza

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Zezza, G. (2011). Income Distribution and Borrowing: Growth and Financial Balances in the US Economy. In: Arestis, P., Sobreira, R., Oreiro, J.L. (eds) The Financial Crisis. Palgrave Macmillan, London. https://doi.org/10.1057/9780230303942_5

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