Front Matter

An Essay on Capital

Israel M. Kirzner

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Foundation for Economic Education

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ISBN (ebook): 978-1-63069-604-7

Original publication date: 1966

by Augustus M. Kelley

2017
Published under the Creative Commons Attribution 4.0 International License

B’EZRAS HASHEM

TABLE OF CONTENTS

Foreword by Peter Lewin

Preface

1. Unfinished Plans

Introduction

A Digression on Method

Individual Decisions and the Market

The Decisions of Crusoe: Multi-period Decisions

The Half-Finished Project

Crusoe and An Overlapping Sequence of Plans

Multi-Period Planning by the Individual in a Market Economy

Interacting Plans

The “State of Affairs” of an Economy

Some Remarks on the Theory of Capital

Is a Theory of Capital Really Necessary?

2. Stocks and Flows

The “Presence” of Capital Stocks

Stock Demand and Flow Demand

Are Capital Goods “Used Up” in Production?

Hicks and the Stock-Flow Production Function: A Digression

Capital Stocks and Income Flows

Knight and the Permanence of Capital

A Critique of the Knightian View

Capital and Income

3. Capital and Waiting

Capitalistic Production as Exchange Across Time

Lags vs. Simultaneity in Capitalistic Production

A Criticism of the Synchronization View

The Period of Production Concept in the Contemporary Literature

Capital and Waiting

Is “Waiting” a Factor of Production?

4. Measuring Capital

A Discussion of the Problem of Capital Measurement

What Should a Measure of Capital Measure?

The Quantity of Capital Available to an Individual

Backward-Looking Measures of Capital: The Individual

Forward-Looking Measures of Capital: The Individual

The Quantity of Capital Available to an Economy as a Whole

The Capital Measurement Problem in the Literature

Physical Goods or Abstract Fund—What Are We Trying to Measure?

The Heterogeneity of Capital as an Obstacle to its Measurement

Heterogeneity, Quality Changes, and Forward-Looking Measures of Capital

Market Value as a Measure of Capital

Cost Measurements of Capital

The Durability of Capital as an Obstacle to Measurement

List of References

Index of Authors