Re: [OPE] Did Marx have a loanable funds theory of the interest rate?

Dear Ian;

Marx's theory of interest rate states that there is not 'natural' rate so as t
o regulate its center of fluctuation, as you read. However, Marx also attempte
d to show that the motion of the rate of interest is regualted not just mere b
alance between demand and supply of monetary capital, butin accord with the la
w of motion of phases of buisiness cycles on the basis of real and loanable ca
pital accumulation. My joint work with Costas, Political Economy of Money and
Finance (Macmillan, 1999) may be of some use concerning this problem.

Makoto Itoh

----- Original Message -----
>Date: Tue, 26 Jan 2010 17:30:53 -0800
>From: Ian Wright <wrighti@acm.org>
>To: Outline on Political Economy mailing list <ope@lists.csuchico.edu>
>Subject: [OPE] Did Marx have a loanable funds theory of the interest rate?
>
>
>I've been re-reading Vol. 3, and it seems to me that Marx had a
>loanable funds theory of the interest rate in the following sense:
>?- The interest rate is determined by the supply and demand of
>loanable money-capital.
>?- Unlike other commodities money-capital does not have a natural
>price, since it does not have a real cost of reproduction, hence there
>is no "natural" rate of interest: the interest rate is entirely
>determined by the (accidental) laws of competition between financial
>and industrial capital.
>
>Would anyone disagree with this reading, or wish to add any qualifications?
>
>Any help appreciated,
>-Ian.
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Received on Tue Jan 26 22:14:58 2010