Revenues and demand in a monetary economy of production

Revenus et demande dans une économie monétaire de production

Edouard Cottin-Euziol () and Nicolas Piluso ()
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Edouard Cottin-Euziol: LEGO - Laboratoire d'Economie et de Gestion de l'Ouest - UBS - Université de Bretagne Sud - UBO - Université de Brest - IMT - Institut Mines-Télécom [Paris] - IBSHS - Institut Brestois des Sciences de l'Homme et de la Société - UBO - Université de Brest - UBL - Université Bretagne Loire - IMT Atlantique - IMT Atlantique - IMT - Institut Mines-Télécom [Paris]

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Abstract: In a monetary economy of production, Say's law is invalid for several reasons. On the basis of some of these refutations (Schmitt, 1984; Renaud, 2000), it is possible to state that the revenues generated by the production process are structurally lower than the supply price of production. We study here the dynamics of such an economy and obtain two main results. First, the long-term debt level of this economy has to increase during a growth phase to enable demand to grow at the same pace as supply. Secondly, due to the repayment of this debt, the gap between supply and net revenues generated by the production process widens along a growth phase.

Keywords: Economic Growth; Monetary Economy of Production; Repayment of Past Bank Credits (search for similar items in EconPapers)
Date: 2020-03-18
New Economics Papers: this item is included in nep-hpe
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