[1] Kaldor worked alongside Gunnar Myrdal to develop the key concept Circular Cumulative Causation, a multicausal approach where the core variables and their linkages are delineated.

[2][3][4] He was educated in Budapest, as well as in Berlin, and at the London School of Economics, where he graduated with a first-class BSc (Econ.)

He was elected to a Fellowship at King's College, Cambridge and offered a lectureship in the Economics Faculty of the University in 1949.

From 1964, Kaldor was an advisor to the Labour government of the UK and also advised several other countries, producing some of the earliest memoranda regarding the creation of value added tax.

Despite insightful contributions, Kaldor could not initially win the debate, as monetarist policies where implemented by most central banks.

Kaldor was invited by then Prime Minister of India—Jawaharlal Nehru—to design an expenditure tax system for India in the 1950s.

He also went to India's Centre for Development Studies (CDS) in 1985 to inaugurate and deliver the first Joan Robinson Memorial Lecture.

Owing to these links, the Kaldor family donated his entire personal collection to the CDS Library.

After the publication of John Maynard Keynes' General Theory, many attempts were made to build a business cycle model.

The British Neo-Keynesian John Hicks tried to improve the theory by imposing rigid ceilings and floors on the model.

But most people thought that this was a poor way of explaining the cycle as it relied on artificial, exogenous constraints.

It differed from these theories, however, as Kaldor introduced the capital stock as an important determinant of the trade cycle.

[9] Following Keynes, Kaldor argued that investment depended positively on income and negatively on the accumulated capital stock.

In the standard accelerator model that stood behind Samuelson's and Hicks' business cycle theories investment was determined as such:

He argued that at the peaks and troughs of the cycle the marginal propensity to save shifts in opposite ways.

In the second stage the growth in the capital stock leads to a downward shift in the investment curve as businessmen decide their factories become overfull.

In a recession or depression Kaldor argued that prices should fall faster than wages for the same reasons that Keynes laid out in his General Theory.

If wage and price flexibility are not forthcoming the economy may have a tendency to either perpetual and rising inflation or persistent stagnation.

Kaldor also makes strong assumptions about how wages and prices respond in both inflations and depressions.

If these assumptions do not hold Kaldor's model would lead us to conclude that the cycle might give way to either perpetual and rising inflation or stagnation.

Many of the American Neo-Keynesian economists thought that Harrod's work implied that capitalism would tend toward extremes of zero and infinite growth and that there were no dynamics that might keep it in check.

An expedition from Mars arriving on Earth having read this literature would have expected to find only the wreckage of a capitalism that had shaken itself to pieces long ago.