Demand and growth regimes of the BRICs countries – the national income and financial accounting decomposition approach and an autonomous demand-led growth perspective

Abstract

We contribute to the recent debate in post-Keynesian economics (PKE), comparative political economy (CPE) and international political economy (IPE) on growth regimes. The paper presents an analysis of changes in demand and growth regimes in the BRICs countries, Brazil, Russia, India, and China, after the Global Financial Crisis and the Great Recession of 2007–2009. It discusses and applies two approaches: a first one based on national income and financial accounting decomposition and a second one based on the Sraffian Supermultiplier (SSM) growth model, distinguishing the dynamics of autonomous expenditure growth from those of the induced components of aggregate demand. It is argued that the SSM approach provides the bridge between the traditional approach based on national income and financial accounting decomposition and the analysis of growth drivers, both in PKE as well as in CPE and IPE. This is illustrated by pointing out some changes in the underlying political economy and economic policy growth drivers in each of the countries.