Essays on Value and Distribution

"The essays collected in this volume belong to that general field of economic theory which is traditionally known as the "theory of value and distribution". They were written at scattered intervals extending well over twenty years, though the majority of them date from the 1930s and reflect the intellectual approach of economics in that period. The main characteristic of that approach, as was stated at the very beginning of the earliest of the papers reprinted here (written in 1933), is to seek insight into economic phenomena through "a more rigorous formulation of the conditions under which it is possible to make generalisations about the factors determining economic equilibrium", i.e., by exploring more thoroughly "the economics of that abstract world in which it is possible to give an exact account of the course of events solely by the aid of scientific generalisations", the latter being derived from "a few self-evident postulates alone". In the course of years I have become increasingly sceptical of the usefulness of the "static" approach of neo-classical economics, and if I were writing today, I would certainly not be so confident in asserting that in advancing along the path of increasing purity and generality, the micro-economics of the neo-classical school has not "lost its 'relevance to facts'," or has not "come increasingly to neglect the operation of those forces which 'really matter'." Though the implications of these particular essays are largely critical of that theory -- since they concentrate on clarifying the rigid framework of assumptions necessary for validating its basic assertions -- they do show an insufficient awareness of the fact that meaningful generalisations about the real world can only he reached as a result of empirical hypotheses, and not by a priori reasoning. The essays are grouped according to their particular subjectmatter -- an arrangement which, with one or two exceptions, proved compatible with preserving the chronological order in which they were written. Except in a few instances in which subsequent work has shown the particular conclusions to have been erroneous or incomplete, the papers are printed (except for occasional improvements in grammar) without alteration; but wherever definite errors were found in the original presentation, an indication of this is given in a footnote or (in one instance) by giving a revised version in the text...." Nicholas Kaldor