Karsten Kohler

ICYMI 👇

New section on the DIY Macroeconomic Model Simulation Website: A Stock-Flow Consistent Model of the Monetary Circuit.
https//macrosimula... (1/5)

ICYMI 👇

Personal note: went to (some) of the countermarch yesterday, and then watched TV coverage of both.

@sundersays.bsky.social is right that the far-right/racists on the main march are a (small) minority whose numbers are not growing.

It's the apparent paralysis of the majority that scares me. [1/n]

Here is the correct URL: macrosimulation.org/an_sfc_model

The section provides a detailed numerical and analytical discussion of the model, including how to construct balance sheet and transaction flow matrices, and a simple recipe for building SFC models. (5/5)

It shows how changes in aggregate demand drive credit and money creation, and how shifts in liquidity preference can impact bond markets. (4/5)

The model illuminates the process by which economic production is financed, incorporating the ideas of endogenous money creation and price determination in financial markets. (3/5)

Weaving Cloth from Graziani’s Thread: Endogenous Money in a Simple (but Complete) Keynesian Model One of Graziani’s main themes runs as follows. In order to finance production, the entrepreneur must obtain the funds necessary to pay his workforce in advance of sales taking place. Starting fr...

The section shows how to simulate in R / Python a stock-flow consistent model that captures key ideas of Augusto Graziani’s monetary circuit. The model is an extended version of Wynne Godley’s 2004 paper:
link.springer.com/chapter/10.1... (2/5).

New section on the DIY Macroeconomic Model Simulation Website: A Stock-Flow Consistent Model of the Monetary Circuit.
https//macrosimula... (1/5)

New working paper with @jomichell.bsky.social and Ayoze Alfageme: "An analytical heterogeneous agent macro model of concentration, markups, and falling labour shares" papers.ssrn.com/sol3/papers.... (1/7)

Reform and the UK press It was entirely predictable that immigration/asylum would become the issue voters thought was the most important facing the country. Many p...

New post: Reform and the UK press
mainlymacro.blogspot.com/2025/08/refo...
We have reached the point where a majority of the print media are in effect encouraging civil unrest and racial hatred, yet thanks to political short termism this press remains essentially unaccountable for their behaviour

Open letter from UK university staff: Request for biometric deferral and safe evacuation of incoming Palestinian students and scholars from Gaza to UK Universities More than 40 students currently trapped in Gaza with full scholarships to UK Universities are asking for a safe route to come and study. We, the academic community hoping to welcome these scholars, ca...

UK academics - please sign this open letter to the UK government: Request for biometric deferral and safe evacuation of incoming Palestinian students and scholars from Gaza to UK Universities

docs.google.com/forms/d/e/1F...

Despite its simplicity, the model captures key empirical patterns related to superstar firms and declining labour shares. (7/7)

These dynamics lead to right-skewed distributions, producing a divergence between the average profit share across firms and the aggregate profit share, which is driven up by the biggest firms. The fall in the labour share reduces consumption and slows down growth. (6/7)

At the same time, customers seek lower prices, creating competitive pressure. These mechanisms drive endogenous changes in the firm size distribution. More profitable firms temporarily grow faster, leading to concentration of capital, market shares, and markups. (5/7)

The model captures how pricing, investment, and market concentration evolve at the micro level and affect macro-level outcomes. Firms differ in capital size and market share. Larger firms benefit from lower unit costs due to economies of scale, gain larger market shares, and charge higher markups. 4

... an ABM with bilateral firm-customer matching, and a simplified HAM without direct agent interaction. The HAM replicates key ABM results while allowing for analytical solutions. (3/7)

The paper presents a small-scale analytical heterogeneous agent model (HAM) to explore firm concentration dynamics and the aggregate effects on distribution and growth. It contributes to recent work on tractable macroeconomic agent-based models (ABMs) by comparing two versions of the model: ... (2)

New working paper with @jomichell.bsky.social and Ayoze Alfageme: "An analytical heterogeneous agent macro model of concentration, markups, and falling labour shares" papers.ssrn.com/sol3/papers.... (1/7)

We find that low capital gains taxes and strong
landlord-protection policies that may push households onto the property ladder are linked to more
intense house price booms and busts. (6/6)

In an empirical analysis for 23 OECD countries, the paper
explores the role of speculation-encouraging institutions, credit permissiveness, welfare state regimes
and macroeconomic policy as potential factors. (5/6)

Bringing Minskyan and behavioural theories of endogenous financial cycles
to CPE, this paper argues that the intensity of house price booms and busts is shaped by institutions
that encourage speculative behaviour. (4/6)

This matters as cycles in house prices are large relative to their trend and the intensity of house price cycles
differs across countries. (3/6)

Since the Global Financial Crisis, there is a growing literature on the Comparative Political Economy
(CPE) of housing, but it has not systematically incorporated boom-bust cycles in house prices. (2/6)

New working paper with Engelbert Stockhammer and Ben Tippet: "What goes up, must come down.
Speculation-encouraging institutions and
house price cycles across countries". (1/6) postkeynesian.net/media/workin...

🧵Letter from academics to the German government:

As academics, researchers, and university teachers from a wide range of disciplines, we appeal to you with the utmost resolve:

The section provides a detailed numerical and analytical discussion of the model, including how to construct a 3D plot that shows the basins of attraction of different equilibria. (6/6)

The model thus captures a form of path dependence where a historically given distribution of behavioural rules impacts not only the subsequent trajectory, but also the long-run equilibrium that will emerge. (5/6)

…needs to be contained through sufficiently pervasive punishing. An interesting feature of the model is that its outcomes depend on initial conditions. Only if the population starts with enough Punishers can the Grabbers be eliminated. (4/6)