Agriculture-Industry Relation and the Question of ‘Home Market’: Towards Closing a Century’s Old Debate
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In our journey through the literature on ‘home market’ for industry we find that, time and again,
agriculture has been identified as the potential sector. However, our basic point is that, it is rather the
appropriate government intervention creating scope for Kaleckian ‘domestic exports’ that can mitigate the
short-run problem of ‘effective demand’ faced by industry. But, we also propose that agriculture must
provide industry with sufficient quantity of food – the critical ‘wage-good’. Furthermore, our Kaleckian
framework shows: consistency requires complementarities between demand and supply-side supports for
industrial expansion. Thus, domestic-exports/home-market and adequate food-supply should
simultaneously act on industry and only under such a situation ‘realisation crises’ of both agriculture and
industry could be mitigated. However, by extending our macro-framework we show, under the
possibilities of international food-outflow and especially of finance-capital inflow leading to ‘commodity
speculation’ the ‘autonomy’ of ‘domestic exports’ as the home market for industry reduces significantly,
even becoming counter-productive.