Re: The Axiom of Gross Substitution

[Harry Veeder <eo200@xxxxxx>]

Gunnar:

>
> 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.

My example does not prove Samuelson is right. The example may simply mean
value can redistribute itself without some preceding net investment. An
increase  in the total value of the economy over time would still require a
net investment.

> 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.
>

It doesn't mean starting over completely. Let us keep digging at the site of
knowledge first excavated by Keynes. As we dig deeper we will change our
understanding of the logic-structure first revealed by Keynes.

Harry Veeder


> ----- 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

>