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Distribution, wealth and demand regimes in historical perspective: The usa, the uk, france and germany, 1855–2010

Research output: Contribution to journalArticlepeer-review

Engelbert Stockhammer, Joel Rabinovich, Niall Reddy

Original languageEnglish
Pages (from-to)337-367
Number of pages31
JournalReview of Keynesian Economics
Issue number3
PublishedJul 2021

Bibliographical note

Funding Information: This paper is part of the research project ‘Income distribution, asset prices and aggregate demand formation, 1850–2010: a Post-Keynesian approach to historical macroeconomic data’ (INO16-00008) with financial support by the Institute for New Economic Thinking. Publisher Copyright: © 2021 The Author, © 2021 Edward Elgar Publishing Ltd ad, Cheltenham, Glos GL50 2JA, UK. Copyright: Copyright 2021 Elsevier B.V., All rights reserved.

King's Authors


Most empirical macroeconomic research is limited to the period since World War II. This paper analyses the effects of changes in income distribution and in private wealth on consumptionandinvestmentcoveringaperiodfromasearlyas1855throughto2010 for the UK, France, Germany and the USA, based on the data set of Piketty and Zucman (2014). We contribute to the study of wealth effects, of financialization, and of the nature of demand regimes. We find that overall domestic demand has been wage-led in the USA, the UK and Germany. Total investment responds positively to higher wage shares, which is driven by residential investment. For corporate investment alone, we find a negative relation. Wealth effects are found to be positive and significant for consumption in the USA and the UK, but weaker in France and Germany. Investment is negatively affected by private wealth in the USA and the UK, but positively in France and Germany.

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