Category Archives: Monetary Circulation

The Animal Organism and the Economic Organism

CONTENTS:

  1. THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC
  2. DETERMINISM AND INDETERMINISM – DISAGREEING WITH EINSTEIN
  3. CORRESPONDENCE IN THE CURRENT BASIC DYNAMIC, ORGANIC PROCESS; A DETERMINATE ALGEBRAIC FUNCTION OF THE FIRST DEGREE
  4. CORRESPONDENCE IN THE SURPLUS DYNAMIC, ORGANIC PROCESS; AN INDETERMINATE POINT-TO-LINE CORRESPONDENCE
  5. AVOIDING A VICIOUS CIRCLE OF CRITICISM
  6. THREE IMPLICITLY-DEFINED CIRCULATORY ORGANS
  7. THE TRANSITION TO SYSTEMATIZATION
  8. THE ROLE OF MIND IN THE DEVELOPMENT OF THE HUMAN AND THE ECONOMIC ORGANISMS

 .1. THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC:  (Continue reading)

 

Functions Are Not Seen, But Must Be Understood

Functions are not seen, but must be understood. (Catherine Blanche King, private communication)

A systematic explanation, then, requires a normative theoretical framework.  The basic terms and relations of such a framework would specify the distinctions and correlations that articulate the causes, which are not necessarily visible, of events that are apparent to all.  (CWL 15,  Editors’ Introduction, lv) (Continue reading)

Three Displays of the Diagram of Rates of Flow

We print three displays of the same Diagram of Rates of Flow, AKA the Diagram of Interdependent Velocities.  The second and third displays simply suggest that the serious reader must keep in mind certain precepts as he/she seeks to achieve a new paradigm and a new framework for macroeconomic dynamics. Continue reading

The Principle of Concomitance: The Foundation of Equilibrium and Continuity

Concomitance is, I would claim, the key word in Lonergan’s economic thinking. [Philip McShane, [Fusion 1, page 4 ftnt 10]

Recall that the subtitle of CWL 15 is “An Essay in Circulation Analysis”.  It is by virtue of concomitance that continuity and equilibrium are achieved so as to constitute an orderly process of circulations.  (Continue reading)

Five Why’s

Why Macroeconomists Don’t Flock to Functional Macroeconomic Dynamics

Why Study Peter Burley’s Models?

Why and How the Basic Expansion Fails To Be Implemented

Why Analyze The Productive Process First?

Why Revise The National Income and Product Accounts?

 

Insight Into The “Baseball Diamond”: Discovery For Implementation

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).

A Normative Dynamic Structure, Despite Maladaptive Errors by “Infielders”

Functional Macroeconomic Dynamics has a definite, normative, dynamic structure. Evidently, there is a high degree of indeterminacy to events within such a dynamic structure.  All one can say is the game can go all awry. But despite this almost baffling indeterminacy, it remains that there is a definite dynamic structure. [CWL 21, 211-12]

The velocities of correlated, interdependent payments must keep pace and be in balance. Payments of dummy money move at velocities in circuits; e.g. O = I = E = R (CWL 15, 54) and O’ + O” = I’ + I” = E’ + E” = R’ + R” (CWL 15, 54)  The arrows in the Diagram of Rates of Flow  represent channels containing analytically-distinguished, interdependent, functional velocities.  These dynamic functionings are defined by the functional relations in which they stand with one another.

The intelligibility of the concrete process consists of two components: an abstract primary relativity expressing the normative systematic structure, and a secondary  component of concrete determinations from the non-systematic manifold.  There is a normativity to the dynamic structure.  An analogy from baseball may help to make the point regarding interdependence and keeping pace.

 

A large and positive crossover difference uncompensated by action from the pitcher’s box will result sooner or later in depriving the groups at second and third bases of all their balls, or if the crossover difference is large and negative, it will result in depriving the groups at home and first of all their balls.  Continue reading

Lilley and Rogoff Recommending Negative Interest Rates

We are commenting with respect to Andrew Lilley and Kenneth Rogoff’s “conference draft” discussing the advisability of a FRB policy of negative interest rates:

 Lilley, Andrew and Kenneth Rogoff, April 24, 2019: “The Case for Implementing Effective Negative Interest Rate Policy” (Conference draft for presentation at Strategies For Monetary Policy: A Policy Conference, the Hoover Institution, Stanford University, May 4, 2019, 9:15 am PST) [Lilley and Rogoff, 2019]     (Continue reading)

A McShane Sampler Relevant to Functional Macroeconomic Dynamics

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.

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

Understanding All in a Unified Whole

“if we want 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 of the question along with all the connections between them.” [McShane, 201644]

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