ABSTRACT
Goodwin’s predator-prey model (Goodwin 1967, 1972) is a formalization of Marx’s account of class conflict over distributive shares in his theory of capitalist accumulation. Distribution and accumulation are modeled by means of a non-linear dynamic Lotka-Volterra mechanism, yielding growth cycles. As employment grows the bargaining strength of the working class increases, yielding an increase in the wage share; the falling profit share reduces accumulation and hence the rate of employment; the bargaining strength of the working class weakens, recreating the profitability conditions necessary for accumulation. This mechanism repeats itself forever, unchanged, yielding conservative oscillations with a fixed period in the two main variables, the wage share (u), and the employment rate (v). A large number of authors have analyzed the model, extending it in many directions. This chapter contributes to the much smaller literature investigating the empirical evidence for Goodwin cycles. The theoretical presumption is that because the model captures some fundamental insights of the functioning of capitalist economies, its cycles should be found in the data.
