Different Employment of Capitals in Vertically Integrated Sectors: Smith after the Austrians
The Austrian notion of stages of production and the related principle of the greater productivity of roundabout methods plus the neo-Austrian notions of vertical integration and vertical division of labour are utilized in this paper in an attempt to reconstruct Smith’s convoluted arguments on the different employment of capitals in Chapter V, Book II, of the Wealth of Nations. Smith’s arguments are first clarified in the light of the two concepts of capital (money capital and productive capital), of the two aspects of productive labour (living labour and dead labour) and of the two viewpoints (of an individual and of society) on which Smith’s theory is based. The results of this clarification are then used to prove that, independently of Smith’s own words but in consistency with his theory, the notions of ‘quantity’ and ‘productivity’ of productive labour have a ‘vertical’ as well as an ‘horizontal’ dimension so that they fit both the input-output scheme and the Austrian framework of time-consuming methods of production.
|Date of creation:||02 Jul 2008|
|Date of revision:||02 Oct 2008|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- repec:ebl:ecbull:v:28:y:2004:i:18:p:a0 is not listed on IDEAS
- Meacci, Ferdinando, 2004. "The competition-of-capitals doctrine and the wage-profit relationship," MPRA Paper 20118, University Library of Munich, Germany, revised 2006.
- Smith, Adam, 1776. "An Inquiry into the Nature and Causes of the Wealth of Nations," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number smith1776.
- Young, Allyn A., 1928. "Increasing Returns and Economic Progress," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 38, pages 527-542.
- Smith, Adam, 2008. "An Inquiry into the Nature and Causes of the Wealth of Nations: A Selected Edition," OUP Catalogue, Oxford University Press, number 9780199535927 edited by Sutherland, Kathryn, April.
- Stigler, George J, 1976. "The Successes and Failures of Professor Smith," Journal of Political Economy, University of Chicago Press, vol. 84(6), pages 1199-1213, December.
- Salvadori, Neri & Signorino, Rodolfo, 2011. "Competition," MPRA Paper 38387, University Library of Munich, Germany.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:11702. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.