The full employment interest rate implicit in classical economic theory

Nicolas D. Cole ()
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Nicolas D. Cole: Formerly King’s College London University (BA)

Evolutionary and Institutional Economics Review, 2022, vol. 19, issue 2, No 6, 625-643

Abstract: Abstract By including the rate of normal profit in a simple model of the macro-economy, the full employment interest rate is deduced to be 4½% at which Labor is not exploited by Capital. Criticisms by Marx and Keynes of the free-market economy were misdirected at Classical theory instead of the manipulation of interest rates by Central Banks to favour Capital over Labor.

Keywords: Rate of normal profit; Full employment interest rate; Classical theory; Central Banks (search for similar items in EconPapers)
JEL-codes: B0 E0 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s40844-022-00244-6

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