Re: The Axiom of Gross Substitution

["Gunnar Tomasson" <gunnar.tomasson@xxxxxxxxxxx>]

Harry:

It is ten to one that your thesis does NOT square with Paul Davidson's
understanding of the Axiom of Gross Substitution.

Now let me spell out the substantive point at issue.

Briefly, in his 1939 paper on "The Rate of Interest Under Ideal Conditions",
Paul Samuelson advanced the proposition (a) that the "value" of the
economy's work in progress (my shirt at the cleaners) could increase without
Net Factor Investment therein (without my sending another shirt to the
cleaners), and (b) that Keynes was a fool for suggesting otherwise - or
words to that effect.

IF the Axiom of Gross Substitution does NOT apply to (a) Laundry Tickets,
and (b) the Laundry ON which such Tickets represent a claim, THEN it is back
to Square One for Post-Keynesians who reason AS IF the General Theory had
proved otherwise.

Gunnar


----- Original Message -----
From: "Harry Veeder" <eo200@xxxxxx>
To: "post keynesian thought" <pkt@xxxxxxxxxxxxxxxx>
Sent: Saturday, March 15, 2003 8:12 AM
Subject: Re: The Axiom of Gross Substitution


>
> Gunnar,
>
> Yes, and such a scenario could arise. For example, if you are unemployed
> and looking for a new job, you might consider a clean and pressed as an
> investment in your future.
>
> Harry
>
>
> > Harry:
> >
> > Your point still eludes me.
> >
> > If "value" were "stored" in a Laundry Ticket, then the total "value"
> > attaching to my shirt at the cleaners would exceed that of the same
shirt in
> > my closet.
> >
> > Gunnar
> >
> >
> > ----- Original Message -----
> > From: "Harry Veeder" <eo200@xxxxxx>
> > To: "post keynesian thought" <pkt@xxxxxxxxxxxxxxxx>
> > Sent: Friday, March 14, 2003 9:51 PM
> > Subject: Re: The Axiom of Gross Substitution
> >
> >
> >> Gunnar,
> >>
> >> The point is a 'claim on value' may also function as a store of value.
> >> It doesn't matter what form money takes, it is out of your control.
> >> So go for a walk and smell the roses.
> >>
> >> Harry
> >>
> >>> From: Gunnar Tomasson <gunnar.tomasson@xxxxxxxxxxx>
> >>> Date: Fri, 14 Mar 2003 23:01:46 -0500
> >>> To: Harry Veeder <eo200@xxxxxxxxxxxxxxxxxxx>, post keynesian thought
> >>> <pkt@xxxxxxxxxxxxxxxx>
> >>> Cc: Gang8 <gang8@xxxxxxxxxxxxxxx>
> >>> Subject: Re: The Axiom of Gross Substitution
> >>>
> >>> Harry:
> >>>
> >>> I don't get your point.
> >>>
> >>> First-hand peddling of Laundry Tickets - claims ON value - is Banking,
> > not
> >>> Scalping.
> >>>
> >>> Gunnar
> >>>
> >>>
> >>> ----- Original Message -----
> >>> From: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
> >>> To: "post keynesian thought" <pkt@xxxxxxxxxxxxxxxx>
> >>> Sent: Friday, March 14, 2003 10:03 AM
> >>> Subject: Re: The Axiom of Gross Substitution
> >>>
> >>>
> >>>>
> >>>> Gunnar wrote:
> >>>>>
> >>>>> On Gang8, I suggested - and Geoffrey Gardiner agreed - that Money is
a
> >>>>> "claim" ON rather than "store" OF "value".
> >>>>>
> >>>>> The "store of value" concept is a carryover from the world of
> > Commodity
> >>>>> Money which has no place in the contemporary world of
paper/electronic
> >>>>> "money".
> >>>>>
> >>>>> And, once the "claim on value" view of Money is admitted, the Gross
> >>>>> Substitution Axiom goes out the window - for Money is then to
"value"
> >>> what
> >>>>> Laundry Ticket is to Laundry.
> >>>>>
> >>>>> Or, to put the point differently, Money is to Value what an IOU is
to
> >>> Value
> >>>>> supplied/received.
> >>>>>
> >>>>>
> >>>>>
> >>>>
> >>>> I disagree, because a ticket scalper sees tickets as a store of
value.
> >>>>
> >>>> Harry Veeder
> >>>>
> >>>>
> >>>>
> >>>>
> >>>
> >>>
> >>
> >>
> >
> >
>
>