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The emergence of profit and interest in the monetary circuit

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  • Kakarot-Handtke, Egmont

Abstract

Efficient progress of the monetary theory of production (MTP) is hampered by an unsatisfactory account of how profit and interest emerge in the monetary circuit. As matter of fact, this question puzzled already the classics. It seems evident that it cannot be answered by applying the usual tools. The present paper’s purpose is to overcome the deadlock. This is done by setting the circulation approach on general structural axiomatic foundations.

Suggested Citation

  • Kakarot-Handtke, Egmont, 2012. "The emergence of profit and interest in the monetary circuit," MPRA Paper 43241, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:43241
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    References listed on IDEAS

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    1. Kakarot-Handtke, Egmont, 2011. "Reconstructing the Quantity Theory (I)," MPRA Paper 32421, University Library of Munich, Germany.
    2. Robert E. Hall, 2011. "The Long Slump," American Economic Review, American Economic Association, vol. 101(2), pages 431-469, April.
    3. Tomasson, Gunnar & Bezemer, Dirk J, 2010. "What is the Source of Profit and Interest? A Classical Conundrum Reconsidered," MPRA Paper 20320, University Library of Munich, Germany.
    4. Bruun, Charlotte & Heyn-Johnsen, Carsten, 2009. "The paradox of monetary profits: an obstacle to understanding financial and economic Crisis?," Economics Discussion Papers 2009-52, Kiel Institute for the World Economy (IfW).
    5. Kakarot-Handtke, Egmont, 2011. "The pure logic of value, profit, interest," MPRA Paper 30853, University Library of Munich, Germany.
    6. Keen, Steve, 2010. "Solving the paradox of monetary profits," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 4, pages 1-32.
    7. Kakarot-Handtke, Egmont, 2012. "Taxes, profits, and employment: a structural axiomatic analysis," MPRA Paper 43581, University Library of Munich, Germany.
    8. Kakarot-Handtke, Egmont, 2011. "Keynes’s missing axioms," MPRA Paper 32742, University Library of Munich, Germany, revised 11 Aug 2011.
    9. Kakarot-Handtke, Egmont, 2011. "Squaring the investment cycle," MPRA Paper 32895, University Library of Munich, Germany.
    10. Kakarot-Handtke, Egmont, 2011. "Trade, productivity, income, and profit: the comparative advantage of structural axiomatic analysis," MPRA Paper 43872, University Library of Munich, Germany, revised 18 Jan 2012.
    11. Kakarot-Handtke, Egmont, 2011. "Primary and secondary markets," MPRA Paper 32996, University Library of Munich, Germany.
    12. Egmont Kakarot-Handtke, 2012. "The Common Error of Common Sense: An Essential Rectification of the Accounting Approach," Economics Working Paper Archive wp_731, Levy Economics Institute.
    13. T.A. Boylan & P.F. O'Gorman, 2007. "Axiomatization And Formalism In Economics," Journal of Economic Surveys, Wiley Blackwell, vol. 21(3), pages 426-446, July.
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    Cited by:

    1. Kakarot-Handtke, Egmont, 2012. "General formal foundations of the virtuous deficit–profit symmetry and the vicious debt deflation," MPRA Paper 42912, University Library of Munich, Germany.
    2. Kakarot-Handtke, Egmont, 2011. "Trade, productivity, income, and profit: the comparative advantage of structural axiomatic analysis," MPRA Paper 43872, University Library of Munich, Germany, revised 18 Jan 2012.
    3. Kakarot-Handtke, Egmont, 2012. "Why Post Keynesianism is not yet a science," MPRA Paper 43171, University Library of Munich, Germany.
    4. Kakarot-Handtke, Egmont, 2014. "Onblog Economics Muddle Busting," MPRA Paper 60543, University Library of Munich, Germany.

    More about this item

    Keywords

    new framework of concepts; structure-centric; axiom set; monetary circuit; quantity of money; transaction money; profit; distributed profit; rate of interest; profit ratio equalization; profit and interest puzzle;

    JEL classification:

    • E19 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Other
    • B59 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Other
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology

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