Prosperity and Depression

SUBJECT INDEX TO PARTS I AND II

Acceleration principle, applications of, 51n, 87n, 96n, 112, 134, 304–11, 340–4, 365–7.

——— qualifications in, 96, 101, 308.

——— statement of, 32, 85–105.

Agricultural fluctuations, influence of:

——— on farmers’ purchasing power, 160–1.

——— on industries using agricultural raw materials, 158–9.

——— on industry and trade, 154–64.

——— on investment, 161.

——— on labour supply, 159.

——— on non-agricultural consumers’ goods industries, 160.

——— on real wages, 159.

——— on saving, 162.

——— on world industry, 162–3.

Agricultural output, inelasticity of, 165.

Agriculture, and the business cycle, 151–67.

——— competition of industry with, for factors of production, 166.

——— effect of business cycle on costs in, 167.

——— effect of business cycle on demand for agricultural produce, 165–6.

——— employment during depressions, 159, 260.

See also Crops.

Apartment houses, influence on derived demand for houses of change in demand for service, 88, 93, 102, 308, 341n.

Argentine, 163.

Assets, sale of, 335–9.

Australia, 163, 267, 281, 455, 458.

Austria, chronic unemployment in, 260.

“Austrian” theory, 47n.

Balance of Payments, 68–9, 349, 381, 421, 428, 435, 443, 447n.

Bank-notes, monopoly of central banks to issue, 65.

Banking policy, and the business cycle, 1, 6, 7, 8, 17–24, 60, 64–8, 343, 368.

——— as cause of optimism and pessimism, 149.

See also Contraction and Expansion.

Banks and Banking:

——— destruction of deposit money, 388.

——— discount policy, 22, 33, 381.

——— foreign exchange reserves 383.

——— gold reserves, 383, 387.

——— indirect investment through, 331–2.

——— influence of organisation of, 388.

——— localisation of, 415–25.

——— open-market operations, 22, 33, 381.

See also Central banks and Credit.

Book-keeping, 49, 131.

Bottle-necks in industry, 359–60, 371–2.

Business cycle, agriculture and, 151–67.

——— classification of causai factors of, 7–9.

——— definition and measurement of, 257–82.

——— different cycle patterns, 269n.

——— each cycle an historical individual, 275.

——— eonomic institutional environment and, 6, 7.

——— four phases of, 268–9.

——— general indices of cyclical movement in various countries, 266–7, 453–5.

——— Business cycle (cont.), in general sense and in technical sense, 264–8.

——— plurality of causes of, 5–6.

——— possibility of a general theory of, 274–7.

——— regularity of symptoms improbable, 10n.

——— two regular features of, 277–82.

Business cycle theories, debt deflation theory, 113–16.

——— differences in terminology versus differences in substance, 169.

——— error theories, 111–12.

——— exogenous and endogenous theories, 8–10, 250, 251.

——— harvest theories, 151–67.

——— method of analysis of, 12–13.

——— monetary over-investment theories, 7, 33–72.

——— monetary under-consumption theory, 134.

——— non-monetary over-investment theories, 7, 72–85.

——— psychological theories 142–49.

——— purely monetary theory, 14–28.

——— recent discussions on the theory of, 168–254.

——— static versus dynamic theories, 247–54.

——— under-consumption (over-saving) theories, 118, 141, 244–5.

Canada, 163, 267, 455.

Capital, deflationary effects of flights of, 440.

——— maintenance of, 294.

——— marginal efficiency of, 197, 219, 222, 234, 245, 293n, 379n

——— ratio of, to labour, 297–8.

——— teal, theories of interest, 46n, 195, 196n.

——— shortage, as cause of breakdown, 48–52, 75–9, 103, 112, 127–37, 140, 367–9.

——— time-dimension of, 40n.

See also Investible funds.

Capital consumption, 53–4, 293–5, 305, 398n.

Capital goods, See Producers’ goods.

Capital movements, under free exchange system, 446–7.

——— induced by cyclical variations, 448–51.

——— influence of devaluation on, 439–40.

——— and monetary over-investment theory, 70–71.

Capitalistic structure of production, 39–40, 71, 102, 125, 135, 302–3, 304, 307, 371–2.

Cash, flow from and into banks, 20–21, 24, 24–5, 28.

Central banks, deflation by 329–30.

——— effects of restrictive credit policy of, 349.

——— gold reserve policy of, 429, 432.

——— with localised credit, 428–9.

——— money, 388.

——— monopoly of issue of banknotes by, 65.

Consumers’ goods, effects of agricultural fluctuations on production of, 159, 161.

——— fluctuation of production of, compared with production of producers’ goods, 26, 29, 30, 73, 279–32.

——— increase in demand for, as factor in upturn, 378–9, 383–4, 392.

——— lag between demand for, and production of, 312.

——— producers’ industries expanding at expense of industries of, 288–9.

——— proportion between demand for, and demand for producers’ goods, 48–52.

——— reciprocal action of capital goods production and demand for, 99–100, 132–3, 285–6, 411.

——— savings and, 124–5.

See also Acceleration principle.

Consumers’ outlay, 15–16, 19

Consumption, connection between investment and, 97–8.

——— decrease in, during upswings, 73–4.

——— definition of prosperity and depression from point of view of, 259–60, 262, 263.

——— government consumption and investment, 230–1.

——— propensity to consume, 42n, 126, 162, 198, 210n, 219, 224, 228–9, 231, 298, 319–22, 344n, 383n.

——— reciprocal stimulation of production and, 285–6.

——— under-consumption theories, 118–41, 244–5.

——— upward sloping trend of, 271.

Contraction (Depression, Downswing):

——— breakdown in particular branch of industry, effects of, 350–2.

——— definition of, 14n, 257, 258–64, 269n.

——— due to under-consumption, 233–5, 244–5.

——— expansionary tendencies arising during, 378, 391–5.

——— importance of psychological elements in, 79–80.

——— localisation of, 408–9, 411–12, 421, 425, 446, 449.

——— as a process of readaptation, 57, 323, 391–2.

——— proximate causes of, 348–61.

Contraction process, cumulative:

——— according to Fisher, 114.

——— according to Hawtrey, 21.

——— according to Keynes, 237.

——— according to Spiethoff, 80–3.

——— drying-up of supply of investible funds during, 327–9.

——— fall in demand of investible funds during, 350.

——— general description of, 323–6.

——— intensifying factors in, 325–6.

——— monetary analysis of, 326–44.

Corporate saving, 44.

Costs, adjustments in, 80.

——— expectations as to, 114.

——— increase in, as cause of crisis, 106–10, 353.

See also Agriculture, Prices, and Transport costs.

Credit, banking system and, 17.

——— cyclical implications of seasonal variations in, 66–7.

——— deadlock, theoretical possibilities of, 23, 218–21.

——— deflation and inflation of, 16–19, 21, 138, 139, 362.

——— demand for, 37–8, 183, 302.

——— elastic supply of, 101, 309, 356, 386–7.

——— expansion of, with stable prices, 52–5.

——— instability of, 16–17.

——— localisation of, 408, 415–25.

——— results of contraction of, 20–1, 47, 331–3, 349, 367–8, 377–9.

——— results of expansion of, 17, 41, 51, 54–5, 63–4.

——— rôle in bringing about business cycle, 14–15.

See also Investible funds.

Crisis, see Down-turn.

Crop variations, 6, 7, 8, 10, 16, 69, 265, 346.

——— period of, 152.

Currency: autonomy, national, 422–51.

——— devaluation of, and consequences, 69, 381, 437–41, 447.

——— over-valuation of, 330, 439.

——— under-valuation of, 330, 439.

Cycle, See Business cycle.

Dealer, See Merchant.

Debts, debt deflation theory of depressions, 113–17.

——— deflationary effects of defaulton, 336.

——— deflationary effects of liquidation of, 333, 334–6, 351.

——— liquidation of non-bank debts, 334–6.

——— over-indebtedness as cause of drpression. 113–17.

See also War debts.

Deflation, definition of, 269n, 323.

——— depressing influence on economic activities, 16.

——— forms of deflationary pressure, 329–39, 348–50.

Deflation (cant), secondary deflation, 58–9, 323n.

——— spread of deflation, 324–5.

Demand, for consumers’ goods, increase as factor in upturn, 378–83, 383–4, 392.

——— effect of credit shortage on, 367–9.

——— effect of shortage of factors on, 368–70.

——— expectations regarding, 37–8n, 102, 144n, 147–8, 306, 342–3.

——— international transfers of, 422, 444–5.

——— for money for speculative purposes, 215–17.

——— and supply of saving, interdependence, 198.

See also Shifts in demand and Supply and demand schedules.

Depression, See Contraction.

Derived demand, See Acceleration principle.

Devaluation, See Currency.

Discount rate, 18, 20, 22.

See also Banks and banking.

Discoveries, See Inventions.

Downswing, See Contraction.

Down-turn (Upper turning-point. Crisis), capital shortage as cause of, 47–52, 75–80, 103, 127–37, 367–9.

——— definition of crisis, 257.

——— drop in investment because of insufficient demand as cause of. 374.

——— error theories, 111–12.

——— inevitability of, 52–7, 83–4 104, 368–9.

——— insufficiency of consumers’ demand as cause of, 127–37.

——— maladjustments in structure of production as cause of, 29–30, 70–1, 110–13, 361–2, 364–9, 370.

——— monetary explanation of, 20–1, 348–50, 362–3.

——— onset of, 50–2.

——— over-capitalistic processes as cause of, 45–52.

Down-turn (coni.), partial breakdown as cause, of 350–4.

——— rise in wages as cause of, 107, 109, 372–4.

——— shortage of factors of production as cause of. 77–8, 368–75.

Durable goods, definition of, 29, 88, 262n, 282.

——— over-production of, 76–7.

See also Acceleration principle and Producers’ goods.

Eastern Europe, 275.

Efficiency, of capital, marginal, 197, 219, 222, 234, 245, 293n, 379n.

——— of labour, 109–10, 372–4.

——— of plant, 106–7, 110, 373.

Elasticity, of demand for agricultural produce, 155–8, 160–3.

——— of demand for idle balances, 218–9, 221.

——— of expectations, 343n.

——— of factors supply, 284, 308, 356–61, 368–9, 386–7.

——— of farm output, 165.

——— of money supply, 33, 101, 146, 309n, 317, 356, 367, 387.

——— of supply of funds from inflationary sources, 299, 302n, 309. 371.

——— of wages, 238–9, 243–4, 357, 386.

Employment, under-employment, and unemployment:

——— agricultural, 160, 167, 261.

——— definition of prosperity and depression from point of view of, 258–62, 263–4.

——— expansion from position of full or partial employment, 283–9.

——— free competition in the labour market and, 238–9.

——— indices of, unreliability of, 268.

——— influence of wage reductions on, 239–44, 395–405.

——— and production by groups of industries, 280.

——— quantity of, and national income, 222.

——— theory of under-employment, 233–47.

——— Employment, etc. (cont.), voluntary and involuntary, 237–238.

See also Labour.

Endogenous and exogenous theories of cycle, 8–10, 250, 251.

Exchange, control 69, 381.

——— equalisation fund, 433.

——— methods of maintaining stability of, 441–7.

——— speculation on foreign, 430.

Exchange standards, 431–6.

Expansion (Prosperity, Upswing), definition of, 14n, 269n.

——— elastic supply of credit and factors of production requisite for, 356–7, 386–7.

——— financing of, 70, 101, 139, 289–304.

——— localisation of, 408–11, 425, 446, 449.

——— reasons for collapse, 54–7.

——— smooth tailing-off of, 92, 369n.

Expansion process, cumulative, 19, 74, 86, 101, 237, 282–304.

——— diminished resistance of system at end of, 289, 301–2, 355–62.

——— disturbances created by, 322, 361–77.

——— monetary analysis of, 19, 36–42, 289–304.

——— from position of full or almost full employment, 387–9.

——— from position of partial employment, 63–4, 283–7, 366.

——— reciprocal stimulation of consumption and production, during, 285–6.

——— saving and, 311–22.

Expectations, 37–8n, 102, 114n, 134–4, 145–8, 180–3, 189, 306, 342–3.

——— a dynamic element, 252–3.

——— elasticity of, 343n.

Exports and imports, 409–10, 416, 438, 440, 444, 445, 446–7.

——— during different phases of business cycle, 70–1.

Factors of production, elasticity of supply of, 284, 308, 354–61, 368–9, 386–7.

——— mobility of, 159–60, 358, 370, 373.

——— monopolistic restrictions of, 372–4.

——— price level of, 27.

——— unused, 96, 284n

Financial organisation and the severity of the depression, 116–17.

Food industries, influence of agricultural fluctuations on, 158.

Forced saving, 42, 43, 53, 55, 138, 310n.

France, 267, 454.

Free exchange system, 441–51.

——— capital movements under, 446–8.

——— contrast with gold standard, 445, 447, 450.

——— impact rate of exchange under, 443–4.

——— localisation of prosperity and depression under, 446, 448.

——— transfer of demand under, 444.

Germany, 71, 72, 73, 384.

——— general indices of cyclical movement in, 266, 454.

——— post-war inflation in, 48, 71, 218n, 326n.

——— production and employment by groups of industries, 281, 457.

——— situation in, 360n.

Gestation period, 136.

Gold-bloc countries, situation in, 302.

Gold exchange standards, 60–1, 432n.

Gold production, 274.

Gold standard, 55, 69, 362, 428–9, 431–3, 434, 435, 441, 449–50.

——— as contrasted with free exchange system, 445, 447, 449–50.

——— responsible for cycle, 20, 24–5, 55.

Harvest theories of the business cycle, 151–67.

Harvests, See Crop variations.

Hoarding and dishoarding, 60, 67, 80, 297, 329, 330–1, 333, 403.

——— definition, 35n, 170, 200–2, 204–5, 210n, 236.

——— interest rates and, 184, 205–7, 209–11, 218–19, 237, 363.

Hoarding, etc. (cont.), limits to hoarding, 388–91, 392–4.

——— propensity to, 291.

See also Liquidity.

——— and saving, 123–4, 315–16.

——— supply and demand schedules and, 389–90n.

——— and velocity of circulation of money, 202.

Holding money, motives for, 208–9.

Idle balances, 202, 210n, 213, 218, 221, 390n.

See also Hoarding.

Imports, see Exports.

Income, definition, 175n, 178–80.

——— distribution, changes in, 229–30.

——— earned and available (disposable), distinction between, 177, 296–7, 312.

——— money income versus money value of output, 178–80.

——— national, definition of, 259n.

——— national, and quantity of employment, 222–3.

——— national, unreliability of indices of, 268.

——— time lag in movements of, 137–8, 140.

——— unequal distribution of, 80, 123, 139–41.

——— unexpected, 181.

See also Real income.

Income velocity of money, 15, 61, 231–2, 313–4.

Industries, production and employment by groups of, 280–1.

Inflation, definition of, 172–3n, 269n.

——— influence on economic activities, 16.

——— post-war inflation in Germany, 48, 71, 218n, 326n.

——— as source of supply of investible funds, 172–3, 296, 297–98, 299–300, 309.

Instability, of credit system, 16–17.

——— of economic system, 10–11.

——— of velocity of circulation, 19–20.

Interest rates, 108–9, 138, 146, 234, 299, 307–8, 315, 371, 380, 389, 392.

——— artificial lowering, of 41–2.

——— “classical theory of”, 197–9.

——— definition, 205, 206n.

——— determined by demand for, and supply of, credit, 183–4, 211–12, 301–2.

——— determined by demand for, and supply, of money, 207–8.

——— equalisation of, 415, 417.

——— equilibrium rate, 34–6, 62, 65, 200, 287.

——— and hoarding, 195–221, 363.

——— influence of saving on, 214–16.

——— limit to the fall in, 219.

——— market rate, 34.

——— natural rate, 34, 35, 36–8, 200, 289–90n.

——— nominal and real rates, 37.

——— planned investment and, 211n, 212–13.

——— “pure” theory of, 46n, 195.

See also Profit rate and Supply and demand schedules.

International aspects of business cycle, 27, 68–72, 85, 162–3, 406–51.

International forces as cause of crisis or revival, 70.

Inventions and discoveries, 6, 7, 8, 10, 32, 63, 81, 82, 84. 120, 152, 153, 273–4, 382, 394, 412.

Investible funds, effect of devaluation on supply of, and demand for, 438.

——— factors affecting supply of, 399–81, and demand for, 381–3.

——— sources of supply of, 294–8, 299, 311, 318, 379–80.

——— supply and demand schedules, 149, 291, 294–303, 308.

——— theory of interest rate, 196, 211–12, 215.

See also Supply and demand schedules and Credit.

Investment, agricultural fluctuations and, 161.

——— concentration of, in particular lines, 136, 374.

Investment (coni.), connection between consumption and. 97–8.

——— definition of, 123n, 170, 172, 293, 296, 305.

——— delayed reaction of, 353, 399.

——— designed and undesigned, 192.

——— ex ante and ex post, 131, 176, 180–92, 212–13.

——— financing of 70, 101, 213–14, 309–10.

——— government consumption and investment, 230–1.

——— indirect, through banks, 332.

——— localisation of, 117, 408, 415–25.

——— monetary over-investment theories, 7, 33–72.

——— net and gross, 227, 294, 296, 305.

See also Replacement.

——— non-monetary over-investment theories, 7, 72–85.

——— opportunities, drying-up of, 246–7.

——— planned investment and interest rates, 211n, 212–13.

——— saving and, 35n, 41n, 123, 126, 131–2, 169, 170–95, 314–16.

——— secondary investment, 228.

——— unexpected, 181.

Japan, 261.

Joint-stock system, rising importance of, 117.

Labour, agricultural fluctuations and demand for, 155–7.

——— changes in efficiency of, 109, 110, 373, 396n.

——— elasticity of supply of, 284, 356–62, 386.

——— free competition in the labour market and unemployment, 238–39.

——— migration of, between town and country-side, 159, 167.

——— ratio of capital to, 306–7.

——— real yield of, 155.

——— shortage of, 77–8, 372.

labour organisations. See Trade Unions.

Lag, of bank reserves behind expansion of credit, 363.

——— between earned and available income, 297, 312, 313.

——— of investment behind supply of funds, 353, 399.

——— time-lags, 250–1, 312n, 313n.

——— of wages, 21, 24, 75, 108, 127, 137–8, 140.

——— between wage reduction and increase in production, 399n. Liquidity, liquidity preferences, 60, 169, 299, 333, 339, 380, 383n, 387, 404.

——— infinite elasticity of demand for, 218–9.

——— interpretation, 207, 208, 210.

——— liquidity preference proper, 210, 215, 218, 219.

——— and rate of interest, 195–221, 234.

——— scales of, 339.

——— and wage reductions, 242–3.

Localisation, of credit, 408, 415–25.

——— of prosperity and depression, 408–9, 411–12, 421, 425, 446, 449.

——— of resources, 408–9.

Long waves, 265.

Losses, See Profits.

Maladjustments in structure of production, 29–30, 71, 127–8, 150, 362, 364–9, 370.

——— horizontal, 29–30, 110–13, 132–3.

——— vertical, 29–30, 110,112–13,128, 132–3.

Marginal, analysis, 282.

——— cost, 106, 401, 402.

——— efficiency of capital, 197, 222, 234, 293n, 379n.

——— profit tate, 292n.

——— propensity to consume (save), 42n, 193n, 222–32, 234, 312n.

——— propensity to import, 428n.

——— time lags, 313.

Merchants, strategic position of, 18–19, 139n.

Mobility of capital, 408, 415–25.

——— changes in, 418.

——— cyclical changes in, 424–5.

——— versus mobility of goods, 415–17.

——— sectional, 422–5.

Mobility of goods, imperfect, 408–14.

Mobility of labour, 159, 358–9, 373.

Model sequences, 253–4.

Monetary circulation, contraction and expansion of, as cause of cycle, 16–17, 348, 362–3, 373–4.

——— forms of contraction, 329–39.

——— forms of expansion of, 303–4.

——— instability of velocity of, 19, 66.

——— limits to contraction of, 387–8.

Monetary demand, parallelism of production and, 277–9.

Money, effective quantity of, 61–2, 66.

——— elasticity of supply, 33, 101, 146, 302n, 309n, 317, 356, 367, 387

——— instability of quantity of, 16.

——— money loans, 206n.

——— relationships between interest rate, price level and quantity of, 33–9, 216–17.

See also Investible funds.

Money contracts, effects of rigidity of, 116–17.

Monopolistic restrictions, 144n, 353, 372, 386, 401, 405.

Monopoly, of central banks to issue bank-notes, 65.

Multiplier, 51n, 193–4n, 222–32, 250, 317n, 344n.

New Zealand, 5, 162, 163.

Open-market operations, 22, 33.

Opportunity costs, 290n.

Optimism and pessimism, 6, 84, 145–9. 306n, 370n.

See also Psychological factors.

Over-capitalistic processes as cause of down-turn, 45–8.

Over-indebtedness, as cause of crisis, 113–16.

Over-investment theories, 29–105.

Over-saving, See Under-consumption.

Partial breakdown, consequences of 350–5.

Pessimism, See Optimism.

Population growth, and quantity of money, 121.

Prices, boom with stable, 14n, 52–7, 278.

——— connection between interest rates and, 36–7.

——— effects of rising prices, 19.

——— effect of wage reductions on, 400–1.

——— expectations as to, 144.

——— indices of, 260n, 439n.

——— progressive rise in, as cause of breakdown, 357.

——— rigidity of, and economic stability, 243–4.

——— trend of, 272.

——— under-consumption and the secular, fali of, 120–2.

Producers’ goods (Capital goods), fluctuations of production of, compared with those of consumers’ goods, 26, 29–30, 73, 279–82.

——— increase in demand for, as factor in up-turn, 80, 378–83, 392.

——— industries, expanding at expense of consumers’ goods industries, 288–9.

——— proportion between demand for consumers’ goods and demand for, 48–52.

——— reciprocal action of demand for consumers’ goods and production of, 98, 100, 285–6, 411.

See also Acceleration principle.

Production, capitalistic structure of, 39–40, 71, 102, 125. 135, 302, 304–5, 307, 372.

——— definition of prosperity and depression from point of view of, 259, 262–5.

——— and employment by groups of industries, 280.

——— indices of, 266–7, 270.

——— necessity for shifts in, to prevent down-turn, 368–70.

——— parallelism of monetary demand and, 277–87.

——— upward sloping trend of, 271.

——— volume of, definition, 262n.

See also Maladjustments.

Profit rate, 36n, 37, 81.

Profits, 26.

——— excessive, assourceof saving, 139.

——— fall in, without losses, as cause of breakdown, 150n.

——— inflation profits, owing to time lag in rise of wages, 137.

——— influence of rise in, 141, 286.

——— and losses, as characteristics of business cycle, 263–4.

——— and losses, definition of, 263–4.

——— paper, 49.

Propensity, to consume (save), 42n, 126, 162, 198, 210n, 219, 224, 228–9, 231, 298, 319–22, 383n

See also Multiplier.

——— to hoard, 299.

——— to import, marginal, 428n.

Prosperity, See Expansion.

Protection, See Tariffs.

Psychological factors, 81, 83–4, 143, 145–7, 222–3, 235, 301. 302, 343.

Psychological theories, 143–50.

Public works, 228, 372, 384, 427.

——— classification of expenditure on, 230.

See also Multiplier.

Purchasing power parity, 439n.

Railways, 40, 100, 103, 136, 274, 374.

Real income, continuous rise during nineteenth and twentieth centuries in, 271.

——— definition of prosperity and depression from point of view of, 259–62.

——— of working class during upswing, 320.

Reparation payments, 116n, 451n.

Replacement, 89–92, 293–4, 295, 305, 395.

——— cycles, 84–5.

See also Investment.

Rhythm and periodicity of business cycles, 24–5, 64–8, 83–4.

Risk factor, 292n, 328n.

Roumania, 5, 163.

Russia, 45–6, 104.

Saving and Savings, autonomous and heteronomous, 141.

——— corporate saving, 44.

——— definition: general, 123n, 170; according to Keynes, 35n, 171–2, 296; according to Robertson, 177–8, 296, according to Swedish economists, 131, 176, 180–92, 212–13.

——— deflationary effect of, 118n, 314–15, 316.

——— effect of agricultural fluctuations on, 162.

——— ex ante and ex post, 131, 176, 180–92.

——— excessive profits as source of, 139.

——— and the expansion process, 311–22.

——— forced saving, 42, 43, 53, 55,138, 310n.

——— function of, 125–7.

——— institutional complication in, 318–19.

——— interdependence of demand and supply of, 198–9.

——— and interest, 40–1, 216–8.

——— and investment, relations of, 35n, 41n, 123–4, 126, 131–2, 169, 170–95. 314–19.

——— main source of, 26, 80, 123, 139–41.

——— over-saving theory of depression. See Under-consumption.

——— rate of saving, 127, 133–4, 162, 298–9, 319–22, 337n.

——— as source of supply of investible funds, 296–8, 299, 311.

——— unintentional, 181.

Secular trend, 122, 271–2.

Securities, sales of, 336–9.

Self-financing, 148–9, 290, 294n.

Sequences, model, 253–4.

Shifts in demand, 99–100, 111, 358, 370–1, 412, 422, 444, 449n.

Short waves, 273–4.

Shortage of capital as cause of breakdown, 48–52, 75–9, 103, 112, 127–37, 140, 367–9.

Smooth termination of expansion, 92, 369n.

Speculation, demand for money for, 215–17.

——— on foreign exchanges, 430–1.

State intervention, 60, 230–1, 302n, 391, 404, 405, 427.

See also Public works.

Static theory, assumptions of, 249, 303, 354–5.

Sterling-bloc countries, 302, 430.

Stocks, 18, 19, 21, 94–5.

See also Acceleration principle.

Supply and demand schedules, 149, 291, 294–303, 308.

——— instability of, 303.

——— movements along, and movements of, the curves, 300.

Sweden, 267, 281, 454, 457.

Tariffs, 60, 69, 383, 413–4, 428, 445.

Theories, See Business cycle theories.

Time dimension of capital, 40n.

Trade Unions, attitude of, during upswings, 322, 372–4.

Transport costs, 407–14.

Trend, secular, 122, 271–2.

Under-consumption theories, 118–41, 233–5, 244–5.

Under-employment, See Employment, etc.

Under-saving, See Shortage of capital.

Unemployment, See Employment, etc.

United Kingdom, banking system of, 388.

——— chronic unemployment in, 260.

——— general indices of cyclical movement in, 266, 454.

——— production and employment by groups of industries, 280, 456–7.

——— propensity to import in, 410.

United States of America, banking system of, 330, 331, 388.

——— boom of 1929 in, 14n, 52, 57, 137, 140, 278n.

United States of America (coni.), distribution of income in, 116n.

——— elasticity of demand for crops in, 162–3.

——— general indices of cyclical investment in, 266, 453–4.

——— income velocity of money in, 313.

——— indirect investment through banks in, 332n.

——— production and employment by groups of industries, 280, 455.

——— propensity to import in, 410.

Unused capacity, definition of, 96.

——— expansion with, 283–7.

——— expansion without, 288.

See also Factors of production.

Upswing, See Expansion.

Up-turn (Revival), expansionary tendencies arising during contraction, 377, 371–405.

——— fall In wages as cause of, 395–405.

——— increase in consumers’ spending as cause of, 378, 383–4.

——— increase in producers’ spending as cause of, 378–83, 392.

——— monetary explanation of, 22–3.

——— natural forces of readjustment and, 63, 391–2.

——— necessity of outside stimuli for, 81.

——— responsiveness of economic system to expansionary stimuli after contraction has progressed beyond a certain point, 377, 385–91.

——— restored elasticity of credit supply as condition of, 386–91.

——— restored elasticity of factor supply as condition of, 386.

Velocity of circulation of money, 61.

——— and hoarding, 202–3.

——— increase in, as form of monetary expansion, 304.

——— instability of, 19.

——— interpretation, 202n, 295n.

See also Income velocity.

Wage goods, 155–6.

Wages, effects of fall in, 239–44, 395–405.

——— efficiency, 109, 396n.

——— elasticity of, 238–9, 243–4, 357, 386.

——— failure of, to rise sufficiently as cause of excess of booms, 133–4. 137–41.

——— lag of, 21, 24, 75, 108, 127, 137–41.

——— real, continuous rise during nineteenth and twentieth centuries in, 271.

——— real, influence of agricultural fluctuations on, 159.

Wages (coni.), wage-unit, definition, 235n.

——— wage unit and level of employment, 235.

——— and workers’organisations, 284n, 322, 353, 372.

War debts, 116n, 451.

Western Europe, 5, 273, 275, 450.

Wicksellian process, 34–5, 196, 227, 287, 289, 344n, 410.

Working capital, 18, 23, 26, 342n.

Yugoslavia, 261.