Time and Money: The Macroeconomics of Capital Structure (Routledge Foundations of the Market Economy) Paperback – 8 Jan 2006
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"Time and Money" argues persuasively that the troubles which characterise modern capital-intensive economies, particularly the episodes of boom and bust, may best be analysed with the aid of a capital-based macroeconomics. The primary focus of this text is the intertemporal structure of capital, an area that until now has been neglected in favour of labour and money-based macroeconomics.
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It is increasingly recognized that the weakness in modern macroeconomic theorizing is the lack of any real coupling of short- and long-run aspects of the market process. In the short run, the investment and consumption magnitudes move in the same direction, either both downward into recession or both upward toward full employment and even beyond in an inflationary spiral. But for a given period and with a given technology, any change in the economy's growth rate must entail consumption and investment magnitudes that move, initially, in opposition to one another.
Roger W. Garrison claims that modern Austrian macroeconomics, which builds on the early writings of F.A. Hayek, can be comprehended as an effort to reinstate the capital-theory core that allows for a real coupling of short- and long-run perspectives. Although the macroeconomic relationships identified are largely complementary to the relationships that have dominated the thinking of macroeconomists for the past half century, Time and Money presents a fundamental challenge to modern theorists and practitioners who overdraw the short- run/long-run distinction. The primary focus of this text is the intertemporal structure of capital and the associated set of issues that have long been neglected in the more conventional labor- and money-based macroeconomics. This volume puts forth a persuasive argument that the troubles that characterize modern capital-intensive economies, particularly the episodes of boom and bust, may best be analyzed with the aid of a capital-based macroeconomics.See all Product description
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Very readable, clear and concise book. A must for anyone with wants to understand ABCT theory.
competing theories of unemployment and trade cycles with standard
Subjectivist arguments in this area. The authors'"loose joint" theory
of trade cycles is an extension of arguments made by Austrian
economists Ludwig Von Mises and Friedrich Von Hayek. Garrison also
critiques the ideas Keynesians and Monetarists. One of the key
strengths of the graphics in this book is that it focuses attention on
under appreciated elements of subjectivist-Austrian trade cycle
theory. These graphs clarify the effects that interest rates have on
household decisions on saving and consumption. Also, the graphs
facilitate comparisons between different schools of thought. This book
has little that is really new in the Subjectivist theory of the trade
cycle and its associated critiques of competing theories in this
area. By in large, this book organizes material from other books and
articles, many of which are by Garrison.
The primary value of this book is in its organization and presentation of
this alternative explanation of the trade cycle and unemployment. This
book is important because it facilitates the dissemination of a viable
explanation of important economic phenomena. The need for this
dissemination is both internal and external to the Subjectivist
school. Many members of the Subjectivist school promote this theory
without fully understanding it. Those outside of the school tend to
ignore this theory completely. These two facts are closely
related. Clear representation of these ideas is an essential part of
the effort on the part of Subjectivists to regain their former place
among the mainstream of the economics profession. By doing this in his
book, Garrison has made great progress in reducing the costs of
learning about Subjectivist Capital/Trade Cycle theory. A lower money
price for this book would extend this process further.