We often use the phrase “is *identified *as” to mean “is *defined *as.”

In trigonometry, we study trigonometric *identities. *These relations **remain true** for every value of the **variables** on both sides of the equation. Thus, the fundamental trigonometric identities, following their simple definitions, yield lengthier trigonometric definitions.

Let’s look at three equations in Functional Macroeconomic Dynamics:

*P’Q’ = p’a’Q’*_{Basic outlays becoming basic incomes }+ p”a”Q”_{”Costs” of Basic R&M in the surplus circuit}[1]* (1)*

*Π”K” = **π”α”Κ”*_{Pure surplus outlays} + *π”α”Κ”*_{surplus outlays for surplus R&M} (2)

*k*_{n}[f’_{n}(t-a)-B_{n}] = f”_{n-1}(t) – A_{n-1}[2]_{ }(3)

In equations (1) and (2) we may replace the *equals sign *with the phrase *is defined as *or *is identified as. *

There is a sense in which one may speak of the fraction of basic outlay that moves to basic income as the “costs” of basic production. … the greater the fraction that basic income is of total income (or total outlay), the less the remainder which constitutes the aggregate possibility of profit. But what limits profit may be termed costs. Hence we propose ….to speak of c’O’ and c”O” as costs of production, having warned the reader that the costs in question are aggregate and **functional **costs…. [CWL 15 156-57]

The equations relate certain functional flows such that the relations define the functionings and the functionings define the relations. The whole structure is purely relational. *The equations constitute the definitions *of certain functional flows called *macroeconomic costs.* The formulations constitute definitions in mathematical forms representing faithfully the scientific macroeconomic relations.

Equation (3) defines or identifies a) a lag, and b) the accelerator and accelerated relations of distinct constituent functional flows.

Scientific macroeconomics is the verification of that understanding which **explains** the concrete economic process by terms in their relations to one another. The whole structure is purely relational.

[1]CWL 3, 156-58

[2]CWL 15, 37

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