Journal Article Rate of Profit and Income Distribution in Relation to the Rate of Economic Growth Get access Luigi L. Pasinetti Luigi L. Pasinetti Cambridge Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 29, Issue 4, October 1962, Pages 267–279, https://doi.org/10.2307/2296303 Published: 01 October 1962

IN I958, the O.E.E.C. in Paris published a survey of the gross national products (I956) of their member countries. This survey purported to demonstrate that the total production per person in the Netherlands was the second lowest in Western Europe (see Table I, col. 2). Because this finding is in contradiction with the ideas of productivity in the Netherlands, Dutch economists and statisticians have applied themselves to explain this rather bad relative position. Their studies raised several important questions concerning method and principle in the study of comparative productivity. The first difficulty is presented by the case of exchange rates in calculating gross national product per head. Official rates of exchange are an unsatisfactory basis for calculation, because their use neglects factors of internal purchasing power and internal alteration in price structure. Economists in the O.E.E.C. have themselves dealt with this problem2 and provided the material necessary to correct the official exchange rate. After having corrected the figures in this way,3 excessive differences disappear, at least so far as the European countries are concerned (see Table i, column 3) . A second difficulty to be overcome is connected with the divisor employed to obtain productivity per head. Of course the total population, as used by the O.E.E.C. economists, cannot be maintained. If, for instance, account is taken of social structure to obtain an estimate of the economically active population, quite different results emerge. So, the population of the Netherlands has increased more rapidly than that of the other O.E.E.C. countries. Furthermore, this country also has the highest average age. If these differences are reckoned with, the Dutch position has improved. Still, it remains second from the bottom in European countries (see Table i, column 4).

E M PI RI CALLYBASED generalizations about labor mobility patterns usually are generalizations about that minority of the labor force which consists of hourly-rated manual workers. These generalizations are further limited in most instances to the patterns described by such workers within local labor markets. Such are the confines, for the most part, of the mobility literature a literature inspired by distrust of and dissatisfaction with the conventional model.1 Subject to the constraining influence exerted by the emphasis on market imperfections of the empirical studies, however, our generalizations about mobility for the majority of the labor force and for movement by manual workers among labor markets, rest essentially on our expectations that the predictive implications of the classical model would not be disappointed were they tested. This paper subjects one aspect of those expectations to a test centered around net civilian migration by state in relation to earnings levels by state. In lieu of wage differences as the allocator of labor supplies, the labor market studies, especially the New Haven study, have advanced the job vacancy thesis workers respond to job openings. Wage differences are regarded as of little importance in the allocation process in the sense that the adjustment of labor supplies to the changing needs of industry is more or less independent of wage differences. Because the focus of the present study is on long distance mobility, interstate movement, the following expression of the job vacancy thesis is particularly relevant:

Abstract A graph similar in concept to the conventional profit-volume graph can be used in capital investment planning and can be especially useful in the analysis of relatively complex investment situations. The net discounted cash flow line for the most profitable investment candidate crosses the expected cost of capital line or zone at the highest point. In a large number of investment situations, this line will also cross the internal rate of return line at the highest discount rate and will be above all other discounted cash flow lines at all points. There are also investment situations in which the discounted cash flow lines for the various alternatives will cross. The line for the most profitable alternative does not necessarily lie to the right of the other lines when it crosses over the internal rate of return line. It will, however, be the highest line when it crosses the expected cost of capital line or zone. The line of limitation can be used to predict the cost within reasonable limits.

Abstract Use of employee stock options by large American corporations is widespread. The Courts and the Congress have pondered long and produced complexity in their tax treatment. Financial analysts have been baffled by their possible effects. The accounting profession has once reversed itself as to the effect of issuance of stock options on income, and even yet is far from agreeing that present practice is satisfactory. At least five points of view may be distinguished relative to the accounting aspects of employee stock options: (a) Tax accounting; (b) "Generally accepted" accounting, as reflected by pronouncements of the American Institute of CPAs and the SEC; (c) "Cash value of services" concept; (d) "Accrual of value" concept; (e) Option value concept. This paper initially will look at the effect of the method involved on the reported net earnings of the employer, both in terms of amount and timing. It will then try to set forth a definition of accounting purpose, and test each of the five approaches against that definition. This paper will conclude with its own proposal, based on tax deductions foregone.

Abstract For many years certain accounting theorists have suggested that an asset's value might be measured by the discounted value of its future services. This approach has been given several names, including "time preference analysis," "economic valuation," and "direct valuation." Theorists differ somewhat in the way in which they explain this approach the discounted services approach should be abandoned for theoretical purposes. All we have seen is that it must be imprecise or irrelevant in actual accounting practice. Precision and strict relevance are not necessary qualities in an analytical approach. The approach merely must be able to give us insights into the process this paper is examining. The discounted services approach does this admirably. It fails only when we ask the process examined to model itself on the approach used to examine it. The theorist should feel free to use the discounted services approach whenever it may clarify his thinking. But he should scrupulously avoid using it as a standard of comparison for actual accounting practice.