TY - JOUR
T1 - Wicksell Effects and Reswitchings of Technique in Capital Theory
AU - Pasinetti, Luigi Lodovico
PY - 1978
Y1 - 1978
N2 - The difficulties in traditional capital theory, which have recently given rise to the reswitching of techniques debate, are traced back to Knut Wicksell’s analysis of capital accumulation and to his discussions with Gustaf Akerman. Some of the later discussions on the “Wicksell effect” are reviewed. It is shown that the separation of price changes from physical changes – which was proposed by David Champernowne and Trevor Swan in a polemical argument with Joan Robinson– is not possible in general. It is concluded that Wicksell’s original arguments were correct, although incomplete. When ‘by the last portion of capital is meant an increase in social capital’, then not only is the marginal productivity of capital unrelated to the rate of profit in any predictable way – as Wicksell pointed out; it no longer has any useful role to play.
AB - The difficulties in traditional capital theory, which have recently given rise to the reswitching of techniques debate, are traced back to Knut Wicksell’s analysis of capital accumulation and to his discussions with Gustaf Akerman. Some of the later discussions on the “Wicksell effect” are reviewed. It is shown that the separation of price changes from physical changes – which was proposed by David Champernowne and Trevor Swan in a polemical argument with Joan Robinson– is not possible in general. It is concluded that Wicksell’s original arguments were correct, although incomplete. When ‘by the last portion of capital is meant an increase in social capital’, then not only is the marginal productivity of capital unrelated to the rate of profit in any predictable way – as Wicksell pointed out; it no longer has any useful role to play.
KW - Champernowne-Swan vs Robinson
KW - Exogenous rate of profit?
KW - Reswitching of technique
KW - The Wicksell effect
KW - Champernowne-Swan vs Robinson
KW - Exogenous rate of profit?
KW - Reswitching of technique
KW - The Wicksell effect
UR - http://hdl.handle.net/10807/67308
U2 - 10.2307/3439882
DO - 10.2307/3439882
M3 - Article
SN - 0347-0520
VL - 80
SP - 181
EP - 189
JO - Scandinavian Journal of Economics
JF - Scandinavian Journal of Economics
ER -