Advertisement

The Method of the Pure Ratio in Economic Analysis

  • Amit Bhaduri

Abstract

The method dates back to Ricardo’s seminal Essay on Profits in 1815.1 According to Sraffa’s interpretation in his celebrated Introduction, the rate of profit in agriculture can be defined as a pure ratio independent of relative prices, if ‘corn’ is both the output and also the only input in the form of capital advanced. With corn as the sole basic product required both for its own production and for the production of all other commodities, Ricardo’s conclusion follows that ‘it is the profits of the farmer that regulate the profits of all other trades’.2

Keywords

Income Distribution Growth Theory Relative Prex Equilibrium Property Labour Theory 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Bhaduri, A. (1986) Macroeconomics: the Dynamics of Commodity Production (Macmillan: London) Ch. 7.CrossRefGoogle Scholar
  2. Broome, J. (1977) ‘Sraffa’s Standard commodity’, Australian Economic Papers, 16, pp. 231–6.CrossRefGoogle Scholar
  3. Domar, E. (1957) Essays in the Theory of Economic Growth (Oxford Uni-versity Press, New York) essay 8: ‘A Soviet model of growth’.Google Scholar
  4. Mahalanobis, P. (1953) ‘Some observations on the process of growth of national income’, Sankhya, September.Google Scholar
  5. Pasinetti, L. (1962) ‘Rate of profit and income distribution in relation to the rate of economic growth’, Review of Economic Studies, 29, pp. 267–79.CrossRefGoogle Scholar
  6. Pasinetti, L. (1974) Growth and Income Distribution: Essays in Economic Theory (Cambridge University Press: Cambridge).Google Scholar
  7. Ricardo, D. (1951–73) The Works and Correspondence of David Ricardo I—X ed. P. Sraffa with collaboration of M. H. Dobb (Cambridge University Press: Cambridge) especially vols I and IV.Google Scholar
  8. Sraffa, P. (1951–73) Editorial Introduction to The Works and Correspon-dence of David Ricardo (Cambridge University Press, Cambridge), vol. I.Google Scholar
  9. Sraffa, P. (1960) Production of Commodities by Means of Commodities (Cambridge University Press: Cambridge).Google Scholar

Copyright information

© Mauro Baranzini and G. C. Harcourt 1993

Authors and Affiliations

  • Amit Bhaduri

There are no affiliations available

Personalised recommendations