Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/277479 
Year of Publication: 
2020
Citation: 
[Journal:] European Journal of Economics and Economic Policies: Intervention (EJEEP) [ISSN:] 2052-7772 [Volume:] 17 [Issue:] 2 [Year:] 2020 [Pages:] 208-219
Publisher: 
Edward Elgar Publishing, Cheltenham
Abstract: 
The paper offers a modernized Böhm-Bawerkian approach to capital theory. The Wicksell effect turns out to be a measure for the degree of vertical distribution of labor. I show that a marginal rise in the rate of interest reduces the (modernized) period of production. A 'generalized golden rule of accumulation' is one result of our approach. Based on these results I define a coefficient of intertemporal substitution (CIS). As opposed to the traditional elasticity of substitution between labor and capital, the CIS is also well defined for negative real rates of interest. This is important in the twenty-first century, since we observe a strong overhang of private savings over private investments (secular stagnation).
Subjects: 
Austrian theory of capital
Wicksell effect
generalised golden rule of accumulation
coefficient of intertemporal substitution
negative real rate of interest
JEL: 
E14
E21
E22
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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