Abstract: The purpose of this paper is to present a coherent view of the neoclassical model of capital accumulation as a basis of for a theory of investment of the firm. The model is formulated in discrete time, which brings out more clearly than the usual continuous-time version the crucial distinction between the short and the long run. In the long run there can be no stable relationship between investment and the rate of interest. However, in the short run there does exist a determinate relationship between investment and the rate of interest, and this is consistent with the Keynesian hypothesis.
Publication Year: 1971
Publication Date: 1971-11-01
Language: en
Type: article
Indexed In: ['crossref']
Access and Citation
Cited By Count: 19
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot