Introduction to Multiple-Product Industries Models

Abstract

The models analysed in Chapters 2–7 are without doubt very unrealistic. Absent from consideration were durable capital goods, non-produced means of production and intrinsic joint production of the wool-and-mutton variety — an impressive list of omissions. Yet the models in Chapters 2–7 embody the important feature that means of production are advanced, with profits paid at a uniform rate on their value. Furthermore, the study of these simpler models provides the foundation for the analysis of multiple-product industries models in the sense that the principles established for the former apply mutatis mutandis to the latter. This remark can best be appreciated by considering a particular example.