Category Archives: Cycles

The Process is Always the Current, Purely Dynamic Process, etc. (See full title specification below.)

The process is always the current, purely dynamic process.  The analysis is purely functional, purely relational and explanatory analysis.  The theory is general and universally applicable  to concrete determinations in any Instance; The theory is a normative theory having a condition of equilibrium.

Our subheadings in this treatment are as follows:

  • Always the Current Process:
  • A Purely Dynamic Process Requiring a Dynamic Heuristic:
  • A Purely Functional Analysis:
  • A Purely Relational, Explanatory Analysis:
  • A Theory, General and Universally Applicable to Concrete Determinations in Any Instance:
  • A Normative Theory Having a Condition of Equilibrium:

Always the Current Process: Continue reading

Lonergan’s functional, analytic distinctions are prior to and more fundamental than changes in prices, interest rates, and employment

Lonergan is alone in using this difference in economic activities to specify the significant variables in his dynamic analysis… no one else considers the functional distinctions between different kinds of (production flows) prior to, and more fundamental than, … price levels and patterns, … interest and profits, and so forth….only Lonergan analyzes booms and slumps in terms of how their (explanatory) velocities, accelerations, and decelerations are or are not equilibrated in relation to the events, movements, and changes in two distinct monetary circuits of production and exchange as considered both in themselves (with circulatory, sequential dependence) and in relation to each other by means of crossover payments. [CWL 15, Editors’ Introduction, lxii]

The Intrinsic Cyclicality of the Productive Process

The economy is composed of the production of two conceptually distinct, mutually-definitive types of goods.  Depending on the context they may be named

  • basic goods or surplus goods,
  • consumer goods or producer goods,
  • accelerated goods or accelerator goods,
  • point-to-point goods or point-to-line goods.

An expansion of the surplus production function causes a later acceleration of the basic production function.  First one surge, then later the other surge.  Note the symbols for time (t) and (t-a) in the following formula, “the lagged technical accelerator.” (continue reading)

kn[f’n(t-a)-Bn] = f”n-1(t) – An-1        CWL 15, p. 37