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Finale and Pasinetti’s Legacy

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Part of the Palgrave Studies in the History of Economic Thought book series (PHET)

Abstract

Baranzini and Mirante first report on Pasinetti’s article ‘A Few Counterfactual Hypotheses on the Current Economic Crisis’, where he underlines the relevance of the second Cambridge controversy on income distribution in explaining the financial crises started in 2008. This controversy between the two Cambridges brought to fame the Modigliani-Miller Theorem and deeply influenced modern corporate finance. The wide acceptance of this theorem is, for Pasinetti, partly responsible for the present financial crisis. The authors conclude that thanks to Pasinetti’s original approach, a number of empirical rules and theoretical frameworks, often incompatible with traditional theories, were more satisfactorily explained and understood. Pasinetti’s whole scientific life has been driven by the desire to provide new frameworks for the explanation of the mechanisms at the bases of modern economic systems.

Keywords

Modigliani-Miller Theorem Baranzini Counter-factual Hypothesis Modern Corporate Finance Present Financial Crisis 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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© The Author(s) 2018

Authors and Affiliations

  1. 1.University of LuganoLuganoSwitzerland
  2. 2.University of Applied Sciences of Southern Switzerland and University of LuganoLuganoSwitzerland

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