Abstract

This article examines the historical roots and logical consistency of Kalecki’s theory of degree of monopoly and price determination in an input-output framework. It shows that the Kaleckian theory of prices is open in S0 far as it does not provide any systematic explanation about the determination of individuals mark-ups. Besides, it shows that the mark-up for the economy as a whole does not depend on the conditions of competition. A consistent way to close the system would be to determine the average mark-up through the Marxian rate of pro-fits and the oligopoly prices as deviations from prices of production.

JEL Classification: E11; B24; D42.