There are five figures below from CWL 15: The single figure on the left represents the interrelations of interdependent Monetary Flows; and the figure contains the important condition of dynamic equilibrium: G = c”O” -i’O’ = 0. The four figures stacked on the right demonstrate aspects of the productive phases constituting a Pure Cycle of Expansion. The bidirectional arrows uniting the two sides signify that the dynamic equilibrium among interdependent flows specified on the left is to be achieved consistently throughout the long-run expansion represented on the right. This condition of dynamic equilibrium is that the crossover flows between the two interacting circuits must continuously balance even as they continuously vary in magnitude in the succession of phases constituting the expansionary process. Just as the general laws of simple parabolic or pendular motion are explanatory and applicable to any particular instance of initial angle and velocity, so a) the primary relativities of productive and monetary flows, and b) the primary differentials of long-term expansion explain the economic process, and are normatively relevant in every particular instance. All five diagrams are unitary. Each and every velocitous and accelerative flow of products and money has proximate or remote explanatory aspects embedded in all five diagrams. (Continue reading)
We hope to inspire serious graduate students of economics a) to seek and achieve an understanding of “Macroeconomic Field Theory,” b) to verify empirically Lonergan’s field relations, and c) to use the explanatory field relations as the basis of influential scholarly papers.
We trace developments
- in physics from Newtonian mechanics to modern field theory, and
- in economics from Walrasian supply-demand economics to purely relational, Modern Macroeconomic Field Theory.
Key ideas include a) abstraction and implicit definition as the basis and ground of invariance in both physics and macroeconomics, b) the concept of a purely relational field, c) immanent intelligibility and formal causality, and d) the canons of parsimony and of complete explanation. We highlight some key ideas: (continue reading)
[2/23/20] M. Leon Walras developed the conception of the markets as exchange equilibria. Concentrate all markets into a single hall. Place entrepreneurs behind a central counter. Let all agents of supply offer their services, and the same individuals, as purchasers, state their demands. Then the function of the entrepreneur is to find the equilibrium between these demands and potential supply. … The conception is exact, but it is not complete. It follows from the idea of exchange, but it does not take into account the phases of the productive rhythms. As has been shown, economic activity moves through a series of transformations and exploitations; and this series generates the succession of (point-to-line, point-to-point, cultural, and static phases.) Now each phase in the exchange economy will have its exchange equilibrium, but the equilibria of the different phases differ radically from one another. By this cyclic variation within the exchange equilibria there is effected the “curvature” of the exchange equations. [CWL 21, 51-52] [#78] (Click here for previous “Single Paragraphs” or “Brief Items”)