Brief von Josef Steindl an Jerzy Osiatyński

Steindl, Josef

A-1050 Wien Schwarzhorng 10/17 Jfily 19, 1079- Dear Osiatynski, T hank you for your letter. I am very glad that you find it possible to include my paper on the three versions of the trade cycle into the Kalecki volume 2, and I certainly never expected anything but the acknowledgements which you propose to make. Let re repeat that I was very happy to receive the volume 1 and that T realise y'U have done a very considerable and successful piece of w irk f* Concerning y>ur p int abut my ambridge paper: If the oligip lists sell all their products to the government and the government sipply finances the increased price by a budget efiqit then y u are certainly right: the utilisation will be unchanged and the v lume if profits will be increased ( I think it is by a mere slip that ypu state it will be the same) because the increased saving due t> the olig p'lists will be compensated by government dissaving My only c 'mment is that in practice the oligoplistic sector will always sell a great part of its produfet to private customers and an incre se in profit margins will therefore reduce the real income of the rest of the economy, leading therfo e to a decrease in utilisation. Your argument is, then, a qualification to my statement, and it is certainly interesting in view of the close customer relation of oligopolists and g vernment. As to your other argument in relation to section 5 of my Trade C ir cle paper, I never denied that Kalecki perfectly well knew all this ( the influence of debts or of commitments on ■'■nvestment ), but it is n^t included in his strict mathematical ( or formal ) formulation of the trade cycle theory - which, incidentally, I did not want to criticise at all, because I realise that a trade cycle theory ought ti embody only the most important and general elements of an explanation. It strikes me h wever, that this section 5 of my paper leaves something in the dark which may have contributed to your misund rstanding The c ntrast between a"marginal" and an "integral" formulation in principle applies to b th the financial incentives to invest (internal saving - ir degree of indebtedness) and to the demand incentives ( increase in demand - or capacity utilisation ).

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