... Copyright © 1976 by Duke University Press 1976 4. The theoretical framework of the Treatise: the fundamental equations One of the standard tasks with which every student of Keynes’ writings is confronted is that of tracing the intellectual relationship between...

... Copyright © 1976 by Duke University Press 1976 6. Some further reflections on the fundamental equations As the name he gave them indicates, Keynes saw in his “funda- mental equations of price” the major contribution of his Treatise. As he said in his 193 1 Harris...

... his new formulation was affected by this struggle. I argue that the forced saving thesis is inherently inconsistent with his Fundamental Equations, and the change in the equilibrating mechanism from price to output proposed by Ralph Hawtrey enabled Keynes to completely abolish this notion from his...

... to regard as its major theoretical innovation and as the cornerstone of its analytical edifice-namely , “the fundamental equations” (see Chapter 4 below). True, a reference to such equations had appeared already in the table of contents dated April 1925 (JMK XIII, p. 28, title of Chapter 4...

... that his second fundamental equation can be rewritten as (iin = MiVi- + I- - S 0 0’ 1. Nor do changes in the relative price of consumption and investment goods (i.e., of P’/P) seem to play a systematic role in the subsequent chapters...

... the fundamental feeling that a work can elicit for a particular reading community and the words that actually appear on the page prompts the methodological question of how to proceed when encountering an apparent absence in a text. The reader does not possess a privileged access point from which to offer...

... of an arithmetical slip. Indeed, I should doubt whether any reader who has not talked or corresponded with you could be aware that the whole of the last half of the book was intended to be in relation to a moving base of steady progress (CW 14: 170 4. The Fundamental Equation...

... stale, flat and unprofitable. This is not to deny to static theory its own appropriate sphere. It will become apparent which kind of problem belongs to each branch of study. 4. I now propose to proceed directly to the Fundamental Equation, constituting the marriage of the acceleration...

.... In both the Treatise and the General Theory, a central role is played by the relation between saving and investment. But this similarity actually highlights the basic difference between these two books: for whereas in the Treatise this relationship is used in the fundamental equations to deter...

... but adding that he had neither the time to set out his comments on them nor much to say, confining himself to remark that “the modification in the treatment of the Fundamental Equations that you have nowintroduced right at the outset carry, so it appears 4. The RFK papers include the notes Kahn took...

... Theory of Money: A Reply to Dr. Hayek. Economica 11 : 387 -97. Keynes , John Maynard. 1932 . Keynes' Fundamental Equations: A Note. American Economic Review 22 : 691 . Keynes , John Maynard. [1936] 1967 . The General Theory of Employment, Interest and Money . Reprinted, London...

... validity of such a policy, but rejects it as impractical; in the General Theory, he does not even believe in its theoretical validity. More specifically, Keynes of the Treatise analyzes a reduction in money wages by means of his fundamental equations-and concludes that such a reduction would...

... called cyclical fluc- tuations of empl~ymentwhich is the main subject of the focus of the fundamental equations, he emphasizes “habits, as distinct from more per- manent psychological propensities [which] are not given time enough to adapt themselves to changed objective circumstances.”25...

... that his letter to Keynes-and the note which accompanied it-dealt with sug- gested refinements of the fundamental equations of the Treatise.* So 2. Actually, this material has already been reproduced by Steiger (1971, pp. 204-1 1) from the Lindahl papers, a fact which is unfortunately...

... of the Treatise revolves about Keynes’ “fun- damental equations,” these are (as the title of its Chapter 10 makes clear) “The Fundamental Equations for the Value of Money” (TM I, p. 120; italics added). Again, Keynes explains the absence of a full analysis of the role of wage changes...

... for equilibrium growth resembles Har- rod’s “fundamental equation,” it has to be emphasized that Domar’s (1946, 140) σ, “the potential social average investment productivity,” is not the reciprocal of v. Since “its magnitude depends to a very great extent on technological progress” (140), Domar’s σ...

... on the stocks which I thought of for the December number. . . . The piece in question is concerned with the fundamental dynamic equation (law of growth) which I think is now formulated as neatly as may be together with some explanation about def- initions of saving & investment etc.” (Harrod...

... of steady advance and not as oscillations around a static equilibrium” (ibid. 262). Many of the ideas incorporated in his dynamic theory are to be found in that book, but missing is Harrod’s ‘fundamental growth equation’ that defines the warranted rate...

... I11 and IV), that I failed to deal thoroughly with the effects of changes in the level of output. My so-called “fundamental equations” were an instantaneous picture taken on the assump- tion of a given output. They attempted to show how, assuming the given output, forces could...

..., without any direct evidence at all, an extreme assumption and then to criticize him for it. 2. The parable is absolutely central to Keynes’s discussion of the simple meaning and significance of the fundamental equations. It cannot be dismissed as mere noise (cf. Anticipations, 17...