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Alchian on Keynes

  • Edward W. Fuller
Article
  • 14 Downloads

Abstract

This paper examines Armen Alchian’s work on Keynes’s marginal efficiency of capital. Alchian is correct to assert that Keynes’s theory of investment based on the marginal efficiency of capital is flawed. However, Alchian does not emphasize the importance of Keynes’s error. This paper extends Alchian’s analysis to show that Keynes’s marginal efficiency of capital is a significant error.

Keywords

John Maynard Keynes Armen Alchian Marginal efficiency of capital Net present value 

JEL classification

E12 E22 E43 G31 

Notes

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Palo AltoUSA

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