Working Paper No. 594 | May 2010
Revisiting “New Cambridge”: The Three Financial Balances in a General Stock-flow Consistent Applied Modeling Strategy
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 us as an important contribution to the tool kit available to applied macroeconomists in general, and to heterodox applied macroeconomists in particular.