Stagnation.

Steindl, Josef

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Document type:: Works

Collection:: Josef Steindl Collection

Title:: Stagnation.: Fassung

Author:: Steindl, Josef

Scope:: Typoskript, 12 Blätter

Year of publication:: 1987

Language:: English

Note:: Entstehungsdatum erschlossen. - Zusatz zum Titel fingiert.

Topic:: Growth,cycle and stagnation

JEL Classification:: E32 [Business Fluctuations, Cycles]

Shelfmark:: S/M.39.1

DOI:: https://doi.org/10.48671/nls.js.AC14446311

4 A. Hansen ( 1938, 1941 ) starts from a contemplation of the long secular growth process in the U.S. which reached from the civil war to the great depression. There was, he explains, extensive growth in the form of an increase of population and an expansion of the economy into undeveloped territory in the west of the U.S.: in addi tion the capital-intensive infrastructure of the economy was built up during this time ( transport, communications,power ). All this involved high rates of investment with the consequence that the economy was proceeding at full steam. The extensive growth facilitated also intensive growth by which he means growth of consumption per head which involves innovation, new industries, growing productivity and cheapening of consumption goods. The extensive growth had also favored competition whereas for a stagnating industry it is difficult to tolerate competition. The consequence of the decline in competition was less innovation and a price policy of corporations not favorable to the expansion of the market. The decisive reason why the economy had become"mature" lay in the cessation of extensive growth and the completion of the capital-intensive infrastructure. From this and the difficulty of replacing extensive by intensive growth followed the decline of investment opportunities. The resulting gap in investment could only be filled, according to Haasen, by public investment, the provision of "utility creating assets."

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