ABSTRACT
In this chapter, the author begins with a review of the foundations of A. Shaikh's classical growth and cycles models, in order to provide the strongest possible conceptual support for his empirical investigation of excess demand fluctuations in Spain. Having presented the guidelines of Shaikh's theoretical structure involving credit, excess demand and debt, the author is concerned with the reconstruction of its empirical underpinnings as applicable to the Spanish economy. He estimates the over-all movement of excess demand according to the specifications developed in Shaikh's model of growth cycles. Wesley Mitchell's work pioneered in the meticulous investigation of the changes in the structural relations between input and output prices that produce endogenous business cycles. The balanced path growing at a constant rate follows from the assumption of a fixed profit margin. When random shocks are allowed, however, the system's growth turns into a stochastically sustained cycles around its critical path.
