Quotes from “Reflections on Reswitching and Roundaboutness”

By Roger Garrison (2003)

• The particular temporal profiles of reswitching-prone techniques are sufficiently quirky as to warrant neglect in setting out fundamental supply-side principles – an argument that has its parallel in the neglect of the Giffen good in setting out fundamental demand-side principles.#
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• Essential to the projects [which exhibit reswitching] is an interspersing of revenues and outlays. Any project for which all outlays are made before any revenues are received cannot have multiple internal rates of return.#
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• What is the justification for a rarified unit of capital (dated labor) whose utilization is unwarranted outside the context of the most abstract models?#
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F.A. Hayek, The Pure Theory of Capital (1941)

• A given stock of capital goods does not represent one single stream of potential output of definite size and time shape; it represents a great number of alternatively possible streams of different shapes and magnitudes.#
  CapitalEconomics