Invest/Save/Borrow

[John Gelles <jjgelles@xxxxxxxx>]

On Sun, 26 Feb 1995 Steve.Keen@xxxxxxxxxxx wrote:

> ...
> Briefly, the paper (in the file "Keynesian_Endogenous_Growth.ps",
> in the econ/authors/Keen.Steve directory) shows how Hicks's
> lagged reformulation of Harrod leads to a 3rd order difference
> equation when you introduce the Keynesian presumption that
> investment determines savings. This equation generates both
> growth and cycles, with the rate of growth depending positively
> on the propensity to invest and negatively on the propensity to
> save.
>
> Cheers,
> Steve Keen
> -----------------------------------------------------

	Assuming those with surplus money want to save.

	But others want to borrow to purchase machines
	that will produce more output of necessary stuff.

	Is not saving as good as investing when the
	savings are borrowed by others?  Or is the definition
	of "propensity to save" one that includes the
	"propensity not to borrow"?

		John Gelles