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The Monetary Profit Paradox and a Sustainable Economy - A Fundamental Approach

Marcel de la Fonteijne

MPRA Paper from University Library of Munich, Germany

Abstract: Main goal of this paper is to clarify the paradox of monetary profit. The definitions and formulas introduced will make it simple and straight forward to understand the paradox. In order to understand from where the profits or monetary profits of capitalists and firms emerge I examined the phrase of Marx, ‘Die Gesamtklasse der Kapitalisten kann nichts aus der Zirkulation herausziehen, was nicht vorher hineingeworfen war.’ and classified it as very confusing. I will show where this confusion comes from and show how to cope with problems alike in a systematic way by using definitions and formulas. As a bonus these formulas give us insight under which conditions the economy can be sustainable and that the relation between monetary profit for firms and savings for household defines a very limited solution space in which the economy can operate in a sustainable way and yet only considering the boundary condition for firm profit and household savings. It will also give us a clue where the motivation for participating in the economy comes from.

Keywords: monetary profit; paradox; Marx; Keynes; Capitalists (search for similar items in EconPapers)
JEL-codes: E11 E12 E20 E25 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-his, nep-hme and nep-mac
Date: 2013-10-08, Revised 2014-04-10
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