ABSTRACT
In the preceding chapter, and a series of other works, Edward Nell has sought to link fundamental changes in macroeconomic performance with changes in producer behavior. These changes in producer behavior are rooted in the “transformational growth” of capitalist economies-the growth that changes the technical and institutional structure within which producers act. In particular, Transformational Growth emphasizes the qualitative character of technical change in the shift from craft to mass-production systems in the early twentieth century. Mass-production technologies were adopted because they allowed producers to flexibly adjust output and employment to fluctuations in demand and keep prices constant at the same time. These changes in the character of production technologies in turn feed into market adjustment on the macro level. Transformational Growth is thus an attempt to ground macroeconomics on an understanding of the character of production technology: a macroeconomics based on the actual transformation of the production process in capitalist history.
