In Binswanger (2009) it was shown that in a simple circular flow
model of a pure credit economy, positive growth rates are necessary in
the long run in order to enable firms to make profits in the aggregate. If
the growth rate falls below a certain positive threshold level, firms will make
losses. Certain aspects of this model are challenged by the papers of Zsolt
Gilányi and Reeves Johnson in this issue of the Journal But nevertheless,
both papers confirm the existence of a growth imperative in capitalist
economies. This may be taken as evidence that the finding of a growth
imperative is quite robust with respect to different model assumptions.