Eléments pour une approche endogène des retournements conjoncturels

In: Lettre de l'OFCE, Band 45, Heft 1, S. 95-158

Abstract

Elements for an Endogenous Approach of Recessions and Revivals Jacques Adda, Philippe Sigogne Today cycles are most frequently assumed to be the outcome of the propagation of exogenous shocks through the economic system. We assume here alternatively that cycles are primarily due to the natural instability of market economies. Far from generating cyclical fluctuations exogenous shocks would rather alter their regularity. The purpose of this work is to grasp the working of turning phases : recessions and revivals. The study is twofold. First the main non exogenous variables are compared to the reference - cycles of two economies, for the period 1 972-1 991 : the United States and the United Kingdom. Then an endogenous dynamic process of business cycles is propounded, based upon the interaction of physical tensions, conflicts of income distribution and financial tensions. The analysis phase stresses the role of productive investment as the main vector of the amplitude of fluctuations, though not the usual trigger of turning points. Economic agents behave without knowing ex ante the best path of growth, which is accordingly tested through successive trials. The piling up of physical capital follows a self-sustained process as long as shortages are not strongly felt. The increasing saturation induces the recession when some actors can no longer bid up to obtain the rarefied inputs, physical or financial. Similarly the drop of activity cushions itself as it makes solvent more and more potential buyers. Macroeconomic turning phases are thus built on disparities of microeconomic situations. The saving behaviour of households looks essential to the understanding of these turning phases. The rise of nominal savings during the saturation phase goes along with a falling volume of residential investment, which underlines the role plaid by relative price distorsions of capital and labour at both turning points of the cycle. Broadly speaking, too much value locked in capital goods triggers the downturn. Symmetrically the capital losses of less reproductible assets are a prerequisite of any revival of current operations.