Profit, Inflation and Economic Growth
Abstract - This article examines the assertion that in a closed economic system there is parity between the nominal value of economic growth (a change in the systems GDP for a particular period) and the sum total of profit from all producers of goods and services for that period. If this is in fact the case, then this parity links microeconomic and macroeconomic variables. Consequently, this makes it possible to continue converging various segments of one science whose division has long since concerned economists to such as extent that some of them have characterized this state of affairs at a "huge scandal" (Arrow, K.J. 1967). Moreover, the link between profit and economic growth makes it possible to look anew at the reasons for the existence of periods of business activity and to explain the essence of such concepts as interest and rent.
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- Hicks, J. R., 1969. "A Theory of Economic History," OUP Catalogue, Oxford University Press, number 9780198811633, March.
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