5
of the successive vendors of the land. The value of the land in so
far as it is not directly owned has its counterpart in an equal
value of financial instruments which served to finance the
successive purchases in the same way as reproduceable real capital
has its counterpart in the instruments of credit which made its
coming into existence possible. The current increase in land
value, as far as it is realised ( by the land changing hands ) is
financed by saving in form of financial assets. Since these gains
seem to be quite sizeable it appears that Ricardo's rent has not
lost in importance since his time, the decrease in importance of
agricultural rent having been compensated by an increased
importance of urban rent. Marxists and Ant-imarxists- have been
Ui/f'
unanimous in denying the importance of rent since, they argued,
rent and profit, capital and land, could in practice not easily be
distinguished. But the above analysis shows that there is a
conceptual difference between them which is quite important.
IV. CAPITAL GAINS AND THE NATIONAL ACCOUNTS.
The exclusion of the capital gains from the national accounts has
led to glaring misinterpretations of the data. If households
finance consumption by means of realised capital gains this
appears in the accounts as a reduction of personal saving. If
corporations use such gains to pay more dividends then the
accounts show a reduction in retained profits. The distortion of
the savings rate which has been caused by the stock exchange boom
in the middle of the 80s in connection with the pension funds has
been dealt with in an earlier paper ( Steindl 1990 ).
The capital gains do not arise in the circular flow of production
and incomes, they occupy a special position in the accounts.