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Since the time of classical economists, investment decisions hold centre stage in economic theory. In this article, we integrate classical economists' perspectives on the determinants of investment with the Keynesian theory of effective demand. For this purpose, we employ variables to capture the effects of profitability, the state of demand, and the financial and risk conditions using time series data from 17 major OECD economies spanning the 1960–2017 period. Two are the salient features of our article: The first is the use as profitability variables, the marginal efficiency of capital or the incremental rate of return, and the second is the use of regime changes and respective threshold values for these two key variables. The econometric results show that the profitability variables are decisive in shaping investment decisions and designating phase changes. [ABSTRACT FROM AUTHOR]

Copyright of Efil Journal of Economic Research / Efil Ekonomi Araştırmaları Dergisi is the property of Efil Journal of Economic Research and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper examines Armen Alchian's work on Keynes's marginal efficiency of capital. Alchian is correct to assert that Keynes's theory of investment based on the marginal efficiency of capital is flawed. However, Alchian does not emphasize the importance of Keynes's error. This paper extends Alchian's analysis to show that Keynes's marginal efficiency of capital is a significant error. [ABSTRACT FROM AUTHOR]

This paper proposes TWO benchmarks to ascertain whether a particular financial transaction is acceptable or not in the context of Islamic finance: the 'shari'ah-compliant' benchmark and the shari'ah-based 'raf' al-haraj' (the Removal of Hardship) benchmark. As a cardinal objective (maqasid) of the shariah, the principle of 'raf' al-haraj' prohibits 'usurious' trade. Simultaneously, this paper suggests the necessity of having 'a wise government', or at least a strong government, in order to sustain the elimination of riba ('usurious' profit)--by means of creating and maintaining the marginal efficiency of capital (MEC) à la Keynes at an optimal level. As an alternative to riba, the Muslim community has to pursue an economy where a certain level of MEC is created and maintained for investors and investees. At the moment, these points are understated in existing debates on riba. [ABSTRACT FROM AUTHOR]

Copyright of Procesos de Mercado is the property of Procesos de Mercado. Revista Europea de Economia Politica and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper is a theoretical one and deals with the real interest rate channel of monetary policy and sensitivity of investment to real interest rate. In the first part, the mechanism of the real interest rate channel is analysed. The second part focuses on the neoclassical model of demand for capital, Fisher's theory of investment, Tobin's q and Keynes's investment theory. All these theories are discussed in the context of real interest rate, i.e., whether they consider that investment reacts inversely to changes of real interest rate. The third part of the paper targets application of theories to the framework of the real interest rate channel. The paper concludes that all the mentioned theories of investment imply that investment reacts inversely and permanently to changes of real interest rate and also that central banks may influence investment via all types of real interest rate, i.e., short and long or market and retail real interest rate. [ABSTRACT FROM AUTHOR]

This article tries to show, side by side, juridical and economical conceptions about limits of interest. The introduction contains an approach to the concept of interest and the composition of interest taxes. In follow, is related a short historical about interest collection in world and in Brazil. An approach on juridical limits of interest in Brazil after the Federal Constitution of 1988 is made in detail. Next, the conceptions of several economists about interest taxes are illustrated. Also, those concepts as marginal efficiency of capital and return over investment are object of commentary

One of the core premises of post Keynesianism is that a proper understanding of the macroeconomy demands a dynamic analysis set in historical time. The default tool of mainstream economics, the general equilibrium framework, cannot possibly capture such a world. The goal of this paper is to suggest an alternative that allows for path-dependent, holistic analysis: system dynamics. Developed in the 1950s by Massachusetts Institute of Technology engineer Jay Forrester, not only does the worldview it embraces share much with that of post Keynesians, but there are many resources from which to draw including a wide literature, ready-made software, and numerous how-to guides. The paper provides an introduction to system dynamics and builds a model of Keynes's trade cycle theory. [ABSTRACT FROM AUTHOR]

The evolution of the market development of any kind registered an overlapping and conditioning of financial markets and economic performances, reinforcing, after the 80's, the connections between the financial system and industrial economy in relation to the age of conglomerates. Although the financial system uses its assumed functions of not being responsible for the cyclic instability of the economies, which has a negative influence over the average rate of economic growth over long periods, macroeconomic analyses reflect the financial origins of cyclic instability. [ABSTRACT FROM AUTHOR]