The Ricardian rent theory two centuries after
Christian Bidard ()
No 2014-54, EconomiX Working Papers from University of Paris Nanterre, EconomiX
We propose to re-read Ricardo's theory of rent and its modern versions. Ricardo's dynamic approach follows the transformations of a long-term equilibrium with demand. Sraffa adopted the same framework while substituting a value criterion for a physical criterion to determine the incoming marginal method, but he did not state the law of succession of methods explicitly. This prevented him to realize that his critique opens the door to all complications of capital the ory, with the consequence that the Ricardian dynamics fail when a divergence appears between profitability and productivity. Contemporary studies have cast doubts on the validity of some of Ricardo's and Sraffa's over-optimistic conclusions, but the abandonment of the dynamic approach does not allow them to explain the ultimate reason of the phenomena they have pointed at. Ricardo's method has been recently rediscovered by mathematicians.
Keywords: Classical theory; land; rent; Ricardo; Sraffa. (search for similar items in EconPapers)
JEL-codes: B12 B51 C61 D33 (search for similar items in EconPapers)
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