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The maximisation of the rate of financial profit
[La maximisation du taux de profit]

Author

Listed:
  • Louis de Mesnard

    (LATEC - Laboratoire d'Analyse et de Techniques Economiques [URA 342] - UB - Université de Bourgogne - CNRS - Centre National de la Recherche Scientifique)

Abstract

On the traditional micro-economic theory, firms are supposed to maximise pure profit. We study what happened when we take into consideration shareholders and the financial profit remunerating the financial capital. We show that it is necessary to surrender the financial profit maximisation to use the rate of financial profit maximisation. The cases of concurrence with fix coefficient of capital, monopoly with fix coefficient of capital, monopoly with variable coefficient of capital are studied, and the role of contraints of rentability are treated. The solutions given by the profit maximisation and by the rate of profit maximisation are compared. We conclude to a reduction of the volume of investissement on some situations, a non automatic clearing of markets and to the necessity to revise some conclusions of industrial, normative and wellfare economics.

Suggested Citation

  • Louis de Mesnard, 1991. "The maximisation of the rate of financial profit [La maximisation du taux de profit]," Working Papers hal-01541880, HAL.
    • Handle: RePEc:hal:wpaper:hal-01541880
    Note: View the original document on HAL open archive server: https://hal.science/hal-01541880
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