A central feature of Keynesian theory is the importance which is attached to entrepreneurial investment decisions. These are assumed to be independent of saving decisions, and to have a dominant influence on the economy. In Keynes’s own work, they played a major role in the determination of effective demand and employment in the short run,1 and their influence on this will be analysed in Chapter 12 of the present book. It can be argued that investment decisions will also play a major role in the determination of the share of profits in the National Income, the rate of profit on capital, the rate of technical progress and the rate of growth. These possibilities will be outlined in turn in this chapter.
KeywordsNational Income Technical Progress Growth Theory Full Employment Price Inflation
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