Capital Gains in Economic Theory and National Accounting

Steindl, Josef

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Document type:: Works

Collection:: Josef Steindl Collection

Title:: Capital Gains in Economic Theory and National Accounting: Alte Version

Author:: Steindl, Josef

Scope:: Typoskript, 15 Blätter, mit Anstreichungen und Anmerkungen

Year of publication:: ohne Datum

Language:: English

Note:: Eine längere Version des vorliegenden Textes wurde post mortem (1998) publiziert. Die in diesem Typoskript vorhandenen Texteile sind im Wesentlichen identisch mit dem publizierten Text (es fehlen Kapitel 9 und Teile von Kapitel 10).

Topic:: Economic history,economic theory,current developments

JEL Classification:: E22 [Investment, Capital, Intangible Capital, Capacity] E01 [Measurement and Data on National Income and Product Accounts and Wealth, Environmental Accounts]

Shelfmark:: S/M.22.6

DOI:: https://doi.org/10.48671/nls.js.AC14446150

12 think of the way in which Keynes dealt with the phenomenon of demand inflation ( Kalecki's opinion on the subject was the same). The logic of effective demand implies that in an underemployed economy additional investment ( or budget expenditure or exports or any other additional kind of spending ) will call forth additional output and incomes sufficient to create the saving necessary to finance the investment. If, however, full or over full employment of resources has been reached so that additional output can not materialise then further additions to investment ( or other types of spending ) will exhaust themselves in an increase of prices and the excess profits thereby created will finance the investment ( or other types of spending ). Thus the identity of the amounts of investment and saving will again be established but by a different mechanism - increase of prices rather than increase in output. In the case of raw materials where supply is inflexible at least in the short run the price adjustment method is valid even in an otherwise underemployed economy. The view of capital gains suggested in this paper is nothing but the application of the same ideas to the special case of non- reproduceable or limited assets, a case more special in that it applies only to assets of a certain type, and yet more general in that it holds also in underemployed economies. In both cases the shift in distribution is the essential feature. There is nothing strange then, after all, in the concept of saving needed to finance not only real investment but also the increase in price of assets with inflexible supply. VH CAPITAL GAINS AS A RETURN ON THE ASSET.

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