I take the point, but in both cases capitalists are supplying both markets
only to make a profit--it's just that investment capitalists won't make a
profit unless the consumer ones are doing likewise at a sufficient scale.
Keynes, by the way, was a great fan of Marx's M--C--M+ analysis, and quoted
it in an early draft of the General Theory. Unfortunately, it was edited
out. I think the GT would have been a lot less obscure if he had quoted it.
Steve
At 03:47 AM 22/03/2002 Friday, you wrote:
>Steve writes in 6794
>
>>The argument in that chapter was just to explain Keynes's critique of
>>Say's Law Rakesh: it wasn't the basis of my entire analysis of cycles in
>>capitalism! -:)
>>
>>All that Keynes was trying to do in his D1/D2 analysis was counter the
>>neoclassical view that if there are 2 markets and one goes down, the
>>other must go up--insufficient demand in one means excess demand in the
>>other. Keynes simply divided output into two markets and gave an
>>explanation why if one (consumption) went down, then the other
>>(investment) was likely to go down too--not up.
>
>Well of course I do not disagree with the possibility either in theory or
>reality of general gluts.
>
>My point is that the claim that the demand for investment goods derives
>from the demand for consumption goods seems to be a euphemistic way of
>articulating the pretty conception that the aim of capitalist production
>is the direct satisfaction of the consumption of the producers.
>
>This is why I am sensing something of a contradiction in this chapter.
>
>All the best, Rakesh
Home Page: http://www.debunking-economics.com
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