According to Clark (1935a, b), if the various studies on the secondary effects of public works expenditures are examined, two main approaches to the analysis of the problem are revealed: “one via successive cycles of income and spending by ultimate recipients of income” – which the Columbia economist termed the “Kahn-Keynes” approach – “the other via the volume of money and its velocity of circulation.” As is well known, in the first approach, business fluctuations are seen primarily as a consequence of fluctuations in current investment. Accordingly, the amount of the secondary effects is determined by: (a) the amount of the net increase in investment; (b) the marginal propensity to consume; and (c) the length of the income propagation period. As it appears from the above, in the “Kahn-Keynes” analysis of the secondary expansion, money plays only a passive role.
Fiorito, L. (2004), "JOHN MAURICE CLARK AND THE MULTIPLIER: A NOTE", Samuels, W.J. (Ed.) A Research Annual (Research in the History of Economic Thought and Methodology, Vol. 22 Part 1), Emerald Group Publishing Limited, Bingley, pp. 161-172. https://doi.org/10.1016/S0743-4154(03)22006-XDownload as .RIS
Emerald Group Publishing Limited
Copyright © 2003, Emerald Group Publishing Limited