"If one measures labour and land by heads or acres the result has a definite meaning, subject to a margin of error: the margin is wide, but it is a question of degree. On the other hand if you measure capital in tons the result is purely and simply nonsense. How many tons is, e.g., a railway tunnel? If you are not convinced, try it on someone who has not been entirely debauched by economics. Tell your gardener that a farmer has 200 acres or employs 10 men – will he not have a pretty accurate idea of the quantities of land & labour? Now tell him that he employs 500 tons of capital, & he will think you are dotty – (not more so, however, than Sidgwick or Marshall)."That was in 1936. The reference comes from this paper by Velupillai on Krishna Bharadwaj’s contributions to economics.
Wednesday, May 2, 2012
Not entirely debauched by economics
The quote of the week (I should instate it as a policy) comes from a letter from Piero Sraffa to Joan Robinson:
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This provides some helpful context to Robinson's comments in her letter to Meek ("You just do it. You don't have to prove anything.") I believe it also may have something to do with Keynes's choice of man-hours as a suitable invariable measure in the GT. Thanks for posting it.
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