|
|
|
|
Title: |
A Theory of Interest and the Steady-State Rate
of Return on Capital |
| Author: |
Hong, Wontack |
| Author
Affiliation: |
Seoul U |
| Source: |
International Economic Journal, Autumn 1987, v. 1, no. 3, pp. 87-90 |
|
Publication Date: |
Autumn 1987 |
|
Abstract: |
Fazi and Salvadori have shown that, by
dropping the unnecessary assumption that the interest rate received by
the workers on their loans to the capitalists is equal to the rate of
profit which the capitalists get from their investment, the Kaldor model
becomes perfectly consistent without assuming that wage income is not
saved. In order to obtain the steady-state rate of return on capital,
however, they need a specific theory on interest rates. Using Hong's
theory on interest rates in the form of "institutionalized monopsonistic
capital market," this paper demonstrates how we can obtain the
steady-state rate of return on capital for a given parameter value of
the interest-rate elasticity of workers' demand for monetary assets. |
|
