18 Clark: Apostle of Two‐Factor Economics

Abstract

The American Journal of Economics and SociologyVolume 62, Issue 5 p. 353-393 18 Clark: Apostle of Two-Factor Economics KRIS FEDER, KRIS FEDERSearch for more papers by this author KRIS FEDER, KRIS FEDERSearch for more papers by this author First published: 01 December 2003 https://doi.org/10.1111/j.0002-9246.2003.00268.xCitations: 1 *In a Leontief input-output production model, for example, the quantities of capital goods are not exogenously given but endogenously determined on the basis of given original resources, the technical coefficients of production, and a specified set of final demands. *Division I, pure production, has both statics and dynamics. Clark says in footnote 1, pp. 34–45, that there are four fields—(1) primitive economic statics, (2) primitive economic dynamics, (3) social economic statics, and (4) social economic dynamics. However, “As our entire purpose is to understand the laws of a dynamic social industry, we attain our end by covering only fields 1, 3 and 4.” *Given rent at time t of Rt, interest rate i, and appreciation rate a, the selling price at time t is Rt/(i − a). *It is worth noting that interest is not equal to rent, as Clark suggested, but greater. Rent plus the annual appreciation of land value equals annual interest cost. If population and rents were constant over time, appreciation would be zero and rent would equal interest just as Clark said, but the equality of rent and interest is only an equilibrium condition, not an identity. *A resource is said to be scarce when less is available than individuals would choose to use if it were freely available in unlimited amount. Scarce resources are economic resources. *If builders were compensated by others for providing net benefits to surrounding land, then the rent of that land would not increase by their efforts. In order to use the lands so benefited, one would have to pay a fee for services, which would reduce by so much one's bid price for the land. Read the full textAboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinked InRedditWechat Citing Literature Volume62, Issue5November 2003Pages 353-393 RelatedInformation