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Transformation problem: The transformation problem is the problem specific to Marxist economics, and not to economics in general, of finding a general rule by which to transform the values of commodities based on socially necessary labour time into the competitive prices of the marketplace. The essential difficulty is how to reconcile profit in ...
In economics, capital goods or capital are "those durable produced goods that are in turn used as productive inputs for further production" of goods and services. [1] A typical example is the machinery used in a factory. At the macroeconomic level, "the nation's capital stock includes buildings, equipment, software, and inventories during a ...
Pages in category "Capital (economics)" The following 52 pages are in this category, out of 52 total. This list may not reflect recent changes. ...
In this sense, it is much more general and plausible than the Heckscher–Ohlin model and escapes the logical problems such as capital as endowments, which is, in reality, produced goods. [ 22 ] As the theory permits different production processes to coexist in an industry of a country, the Ricardo–Sraffa theory can give a theoretical bases ...
In 20th-century discussions of Karl Marx's economics, the transformation problem is the problem of finding a general rule by which to transform the "values" of commodities (based on their socially necessary labour content, according to his labour theory of value) into the "competitive prices" of the marketplace.
In his Nobel lecture, Hicks cites Value and Capital for clarifying an aspect of what became known as the aggregation problem. The problem is most acute in measuring the capital stock by its market value for the real-world case of heterogeneous capital goods (for example, steel presses and shovels).
In economics, a price mechanism refers to the way in which price determines the allocation of resources and influences the quantity supplied and the quantity demanded of goods and services. The price mechanism, part of a market system , functions in various ways to match up buyers and sellers: as an incentive, a signal, and a rationing system ...
Capital accumulation forms the basis of capitalism, where economic activity is structured around the accumulation of capital, defined as investment in order to realize a financial profit. [184] In this context, "capital" is defined as money or a financial asset invested for the purpose of making more money (whether in the form of profit, rent ...