Garegnani on a way to avoid the value capital endowment in Wicksell (1898)

CSWP 11 (April 2015)

Author Fabio Petri


JEL B13, D50

Pierangelo Garegnani has argued that the value capital endowment could have been avoided in Knut Wicksell’s long-period general equilibrium in Value, Capital and Rent (1898); the capital endowment might have been specified as an amount of labour embodied in the economy’s stock of capital goods, which would have avoided the vicious circle of a factor endowment dependent on the prices the equilibrium must determine. The paper argues that this thesis cannot be accepted.

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