Full text: Growth and Stagnation

Also the foreign balance may play a similar role. In a 
ress^ion it will be activated owing to the decline in 
imports which will be sizable in a country much dependent 
on foreign trade, and the foreign surplus will absorb 
domestic savings just as the government deficit does 
and therefore will ease the pressure exerted by the 
relative inflexibility of household savings on profits. 
It follows that in an economy which experiences a 
decide growth there will be pressure on profits 
and business saving and enforced indebtedness either of 
* * 
business or of government or of the rest of the world. 
In the 1930s this problem was compounded by the fact 
that prices and wages fell which increased the pressure 
on the debtor. Unnecessary to mention, this all works 
against the disposition to invest. 
To return to the problem of oligopoly. The transition 
to an oligopolistic structure occured in U.S at the 
turn of the century or perhaps a little earlier^, 
that is,decades before the great depression took place. 
How can one maintain here ^causal Link? I think the data 
on capital accumulation show that a gradual decline in 
the growth rate of capital had taken place in the interval 
between the two events. Moreover, in that time also the 
gradual expansion of the corporate system took place, 
or rather the gradual Expansion of the market for shares 
which made it easier to finance capital and therefore 
acted as a stimulant to investment, rather more effective, 
I should guess, than a reduction in the rate of interest. 
This seems to have counteracted the stagnationist tendencies. 
When the stock market broke down in 1929 the appearance

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