Abstract
It has generally not been emphasized that both Marshall and Wicksell used an identical mechanism based on the “cumulative process” to explain how inflation would occur during an expansionary cycle in the relatively short period. The differences between their versions of the cumulative process will be emphasized, including their respective interest mechanisms. Then, it will be shown that although Wicksell put the assumption of full employment and inflation on center stage, Marshall, in analyzing how an economy could escape a troubling depression, described how new employment, as well as a moderate inflation would occur during the upward cycle. Marshall’s analysis of cycles was much more realistic than Wicksell’s.
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