The Rate of Interest, Fisher's Rate of Return over Costs and Keynes' Internal Rate of Return

Republication of Irving Fisher's The Theory of Interest will enable economists to correct an error propagated by a careless statement in Keynes' General Theory. Keynes erroneously alleged that his marginal efficiency of capital is identical with Fisher's marginal rate of return over c...

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Bibliographic Details
Published in:The American economic review 1955-12, Vol.45 (5), p.938-943
Main Author: Alchian, Armen A.
Format: Article
Language:English
Subjects:
Communications
Cost efficiency
Economic costs
Economic theory
Financial investments
Interest rates
Internal rate of return
Investment return rates
Keynesian theory
Keynesianism
Net investment
Present value
Rates of return
Streams
Studies
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Summary:Republication of Irving Fisher's The Theory of Interest will enable economists to correct an error propagated by a careless statement in Keynes' General Theory. Keynes erroneously alleged that his marginal efficiency of capital is identical with Fisher's marginal rate of return over cost, and that it is used for exactly the same purpose. Unfortunately Keynes was wrong; they are not the same and they were not used for the same purpose
ISSN:0002-8282
1944-7981