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Movement Of Wealth


  • Gopinath VadirajaRao Bangalore

    (No affiliation)


Economists say that Law of Equilibrium applies to systems of wealth as well. There is no clear idea as to how this Law operates. In systems of matter and energy equilibrium is reached by movement of matter/energy from higher level/concentration to lower concentration. Similar process operates in systems of wealth of different concentrations connected to each other. To express concentration two forms of wealth are required. When we say 4% sugar solution, 4 grams of sugar is dissolved in 100 grams of water. Here two forms of matter; solute and solvent are involved. Similarly in price(price is one expression of concentration of wealth) two forms namely money and goods are involved. Concentration of one form of wealth is always reciprocal of concentration of other form of wealth. In some cases only one form of wealth is mobile and other is static. I have termed such movement as Osmotic Movement of Wealth. When wealth moves from higher concentration to lower concentration, a)Increased savings; b)Increased returns; c) decreased cost OR all three above result.

Suggested Citation

  • Gopinath VadirajaRao Bangalore, 2005. "Movement Of Wealth," General Economics and Teaching 0502067, EconWPA.
  • Handle: RePEc:wpa:wuwpgt:0502067
    Note: Type of Document - doc; pages: 10. Matter, energy and wealth have two common properties. Law of Conservation an Law of Equilibrium are two important laws that apply to all three. Both the laws are inseparable and do not operate in isolation.

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    References listed on IDEAS

    1. Robin M. Hogarth & Spyros Makridakis, 1981. "Forecasting and Planning: An Evaluation," Management Science, INFORMS, vol. 27(2), pages 115-138, February.
    2. Armstrong, J Scott, 1978. "Forecasting with Econometric Methods: Folklore versus Fact," The Journal of Business, University of Chicago Press, vol. 51(4), pages 549-564, October.
    3. JS Armstrong, 2004. "The Seer-Sucker Theory: The Value of Experts in Forecasting," General Economics and Teaching 0412009, EconWPA.
    4. Armstrong, J. Scott, 1982. "The value of formal planning for strategic decisions: review of empirical research," MPRA Paper 81683, University Library of Munich, Germany.
    5. Armstrong, J. Scott, 1978. "Forecasting with Econometric Methods: Folklore Versus Fact," MPRA Paper 81672, University Library of Munich, Germany.
    6. Thune, Stanley S. & House, Robert J., 1970. "Where long-range planning pays off Findings of a survey of formal, informal planners," Business Horizons, Elsevier, vol. 13(4), pages 81-87, August.
    7. Armstrong, J. Scott, 1977. "Social irresponsibility in management," Journal of Business Research, Elsevier, vol. 5(3), pages 185-213, September.
    8. JS Armstrong, 2005. "The Value of Formal Planning for Strategic Decisions: A Reply," General Economics and Teaching 0502065, EconWPA.
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    More about this item


    Law of Equilibrium; Law of Conservation of Wealth; Osmotic Movement of Wealth;

    JEL classification:

    • A - General Economics and Teaching

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