I do not have a video capability on this website, but perhaps the reader could, in his/her imagination, superpose simultaneously upon the Diagram of Rates of Flow several key formulas and images. This exercise and self-testing should be beneficial to the serious student. In addition to seeing and having insight into each image in a sequence, the reader would, by superposition see the inner workings and interrelations of the velocities and accelerations all at once in interdependence rather than alone and separately. The superpositioning of each diagram with its formulas offers the opportunity to consider the ideas and schemes one-at-a-time. one-against-one, and all-at-once. An imagining and understanding and affirming would bring home to the reader’s mind the full complexity of the always-current, purely dynamic, organic process. And it would help the reader to appreciate the wisdom in Lonergan’s orderly presentation.
Here is a list of key formulas and images to be considered: Continue reading
“δὶς ἐς τὸν αὐτὸν ποταμὸν οὐκ ἂν ἐμβαίης.” (Heraclitus)
“No man ever steps in the same river twice.” (translation of Heraclitus)
Each of the 1970’s, 1980s and current 2020s has featured its own unique and nuanced combinations of circulating flows of products and money in phases of normative expansion, divergent boom; and corrective contraction. The flows of these decades are not all identical flows which anyone can simply reference to justify a present shallow opinion.
The Wall Street Journal of Monday, August 7, 2023 included Alan S. Blinder’s reply to John H. Cochrane. (See the two posts below on this Home Page.) Continue reading
There is sufficient content in this Section 26 to serve as the basis of an impressive graduate thesis featuring explanatory first- and second-order differentiations of interdependent functional activities implicitly defined by their functional relations to one anther. The set of equations would constitute a significant part of a complete explanatory theory.
Part I: Introductory
Part II – Divergent Flows of Products and Money; Consequent Inflation or Deflation
Case A: The problem of an inadequate rate of saving in a surplus expansion; I”/(I’+I”)
A note re stagflation stifling a full surplus expansion
Case B: The problem of an excessive rate of saving in a basic expansion
Part III – Outline of Traditional Theory’s Lack of Understanding re Artificially Manipulating Interest Rates
Part IV – Selected Excerpts and Comments Relevant to CWL 15, Section 26, “The Cycle of Basic Income,” pages 133-44
Thus, if we want to have a comprehensive grasp of everything in a unified whole, we shall have to construct a diagram in which are symbolically represented all the various elements along with all the connections between them. [McShane 2014, 11 (quoting CWL 7, 151)]
We wish here to suggest the insights the reader should have to fully appreciate all that is contained in the Diagram of Rates of Flow. (Continue reading).
Our concern, as always, is to understand and verify how money should circulate to meet the rectilinear primary process of production and sale. We seek a normative theory which scientifically explains, rather than merely describes, the current, purely dynamic economic process. The scientific explanation will be in the form of the objective relations of explanatory velocities and accelerations to one another. These explanatory conjugates will be abstract correlations defined by their functional relations among themselves – rather than descriptions – no matter how literary and vivid – of conditions, states, and events as they are related to us and affect us for better or worse. Our goal is to achieve a scientific explanation yielding norms to which we must adapt. (Continue reading)
Lonergan’s achievement – like the achievements of Euclid, Newton, and Einstein – was “to bring together many scattered theorems by setting up a unitary basis that would handle all of them and a great number of others as well.” Note in the excerpts below these phrases
- a field of greater generality
- an enlarged and radically different field
- scientific generalization
- (analytical) level of system
- organized system
- one single organized subject
- a determinate systematic structure
- a determinate field
- a single explanatory unity
- ultimate premises
- the stability of the sets and patterns of dynamic relationships
Generalization comes with Newton, who attacked the general theory of motion, laid down its pure theory, identified Kepler’s and Galileo’s laws by inventing the calculus, and so found himself in a position to account for any corporeal motion known. Aristotle, Ptolemy, Copernicus, Galilei, and Kepler had all been busy with particular classes of moving bodies. Newton dealt in the same way with all. He did so by turning to a field of greater generality, the laws of motion, and by finding a deeper unity in the apparent disparateness of Kepler’s ellipse and Galilei’s time squared. … Similarly the non-Euclidean geometers and Einstein went beyond Euclid and Newton. … The non-Euclideans moved geometry back to premises more remote than Euclid’s axioms, they developed methods of their own quite unlike Euclid’s, and though they did not impugn Euclid’s theorems, neither were they very interested in them; casually and incidentally they turn them up as particular cases in an enlarged and radically different field. … Einstein went beyond Newton by employing the new geometries to make time an independent variable; and as Newton transformed the formulation and interpretation of Kepler’s laws, so Einstein transforms the Newtonian laws of motion. … It is, we believe, a scientific generalization of the old political economy and of modern economics that will yield the new political economy which we need. … Plainly the way out is through a more general field. [CWL 21, 6-7] Continue reading
Philip McShane had a strong background in mathematics and theoretical physics; thus he was able to understand the scientific significance of Bernard Lonergan’s macroeconomic field theory in an Einsteinian context. (See Philip McShane in Categories in the right sidebar)
First we display, in brief, key excerpts, many of which contain analogies from physics and chemistry, relevant to the science of Functional Macroeconomic Dynamics; then we show the same excerpts more fully within lengthier quotes. Continue reading
The brief excerpt below is relevant to a) the appreciation of the new science of Functional Macroeconomic Dynamics, and b) the choices of every society as to what its culture is to be. In particular it is relevant to the achievement of liberation and ongoing freedom in currently totalitarian societies. (Also click here and here) Continue reading