An Overview of Pricing and Production

  • Paul Davidson


Before developing in detail some crucial aspects of the behavioural pattern of entrepreneurs and households, it is well to provide an overview of the workings of the historical model. For expository ease, the analysis can be initially divided into two parts: (1) the production and pricing decisions of entrepreneurs and (2) the monetary and financial relationships. In the initial discussion of Chapters 3, 4, and 5 money matters will be intentionally suppressed by assuming that entrepreneurs experience no difficulty financing any level of production they deem appropriate. In Chapters 6, 7, 8, and 9 monetary phenomena and financial institutions will be in the forefront of the analysis while real sector decisions will be relegated to a subordinate position. Finally, in the latter chapters of the book, both the monetary and real sectors will receive equal billing.


Capital Good Standard Volume Offer Price Sales Revenue Aggregate Supply 
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  1. 1.
    M. Fleming, Introduction to Economic Analysis (London: Allen and Unwin, 1969) pp. 91–5.Google Scholar
  2. Also see S. Weintraub, Price Theory (New York: Pitman, 1949).Google Scholar
  3. 2.
    A. Marshall, Principles of Economics, 8th ed. (London: Macmillan, 1950) p. 617.Google Scholar
  4. 4.
    4 For example, see N. Kaldor, ‘Economic Growth and the Problem of Inflation’, Economica (1959); J. Robinson, Essays in the Theory of Economic Growth; O. Eckstein and G. Fromm, ‘The Price Equation’, American Economic Review (1968) and J. Robinson, ‘A Reconsideration of the Theory of Value’, Collected Economic Papers, 111 (Oxford: Blackwells, 1966) p. 179.Google Scholar
  5. 2.
    R. F. Harrod, Economic Essays (New York: Harcourt, Brace, 1952) p. 260.Google Scholar

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© Paul Davidson 1978

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  • Paul Davidson

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