Introduction, 604. — I. Hypothetical contract of the cost-plus-incentive-fee type, 604. — II. The maximization model, 606. — III. Consideration of the firms entire operations, 612. — IV. Long-run profitability, 614. — V. Conclusion, 615.

PROFESSOR THEIL [5] recently gave the derivation of the best linear (B. L.) index number formulae for price and quantity. In an application of the formulae to Dutch import and export data, Kloek and DeWit [3] found that there is some slight, though persistent, bias to the effect that the index vectors yield larger current values than the individual data do. As this feature is related conceptually to the factor reversal test, they considered it desirable to devise a method which would control this bias on the average and worked out what may be called the best linear average unbiased (B. L. A. U.) index number. The aim of the present note is to indicate what relationship the B. L. and the B. L. A. U. indexes bear to the factorial indexes, that is, to those obtained through the factorial approach [1, 2, 4]. We conclude that the factorial indexes2 appear to compare well with the B. L. A. U. indexes. Incidentally, it is also pointed out that it might be possible to obtain a closer algebraic approximation to the B. L. index number formulae.

T HE theory of the demand for financial assets has come in for a good deal of discussion in the last few years. Undoubtedly the discussion has been fruitful and has given us many new insights into the nature of financial processes. But it cannot be said that there is any generally agreed upon view as to the way in which those processes work. It would be appropriate at a conference of this kind to review the different hypotheses and give a systematic summary of the present state of knowledge. Unfortunately, though I have read the literature assiduously I have found it rather indigestible. I do not feel prepared to give a fair summary of other people's views. I must fall back therefore on giving my own. In this paper I shall deal with the demand for liquid assets and money by households and corporations. Those two groups hold over twothirds of all liquid assets, and the same general approach though not the details can probably be applied to the demands of unincorporated businesses, farmers, state and local governments. In dealing with the demand for liquid assets we must at least implicitly deal with the demand for other types of assets, but I shall not, except incidentally, say anything in detail about the demand for stocks, bonds, or physical assets. I shall confine myself to the demand for currency, demand deposits, commercial bank time deposits, mutual savings bank deposits, savings and loan shares, savings bonds, and short-term federal securities. There are, of course, other liquid assets, but I shall have little to say about them. I have occasionally used the term money in the sense of demand deposits and currency but have usually referred to those assets specifically to avoid any confusion with other definitions of money. But though I am happy to try to avoid the semantic confusion involved in arguments about whether any particular asset should be included under the heading money, I do cling to the view that commercial bank time deposits are significantly different from demand deposits. For that matter, so is currency, and so perhaps we ought to dispense with the term money in theoretical discussions and say clearly what we mean. In the first section of the paper I have discussed very briefly the conditions under which liquid assets are supplied. There follow in section 2 a discussion of corporate motives for holding liquid assets and money and a review of some empirical evidence on the relative importance of various factors influencing corporate decisions. In section 3, this theory of household demand for liquid assets and money is discussed together with some empirical evidence.

Percentage changes in marginal utility are found to be invariant to utility transformations. They are quantifiable in the ordinary sense, and price and income elasticities can be expressed in terms of them. Definitions of necessityluxury, independence and complementarity-substitutability in terms of the measurable utility changes lead to insights for empirical studies. A POTENTIALLY rich source of insights about demand behavior is the wantsatiation characteristics of goods, i.e., degree of necessity or luxury of goods and degree of complementarity or substitutability between them. These characteristics have been stubborn against attempts to bring them into demand analysis. Despite decades of interest, the literature does not appear to have produced satisfactory definitions of complements and substitutes. Previous necessity-luxury analyses have rested on assumed differences in algebraic form of demand functions. Necessity-luxury attributes have not been expressed in terms of the usual utility concepts of consumer choice theory. 2 In the present article, measurable want-satiation characteristics of goods are derived by considering changes in marginal utility when expenditures are shifted within the consumer's budget. It is demonstrated that the percentage change in marginal utility of a good is invariant to utility transformations and can be related to price and income elasticities. This result is due to the previously overlooked fact that the percentage change in the marginal utility of a good, when moving along a given indifference curve, is identical to a change in the marginal rate of substitution brought about by moving from one indifference curve to another. The measurability of percentage changes in marginal utility is thus seen to be as reasonable as the measurability of the marginal rate of substitution. Two systems of percentage changes in marginal utility are developed. The ei system is appropriate for considering one good vis-a-vis all other goods. In this system, an increase in expenditure on a particular good is accompanied by an equal reduction in expenditure distributed among all other goods so

Journal Article The Impact of Credit Control on Consumer Durable Spending in the United Kingdom, 1957–1961 Get access R. J. Ball, R. J. Ball Manchester Search for other works by this author on: Oxford Academic Google Scholar Pamela S. Drake Pamela S. Drake Manchester Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 30, Issue 3, October 1963, Pages 181–194, https://doi.org/10.2307/2296319 Published: 01 October 1963

AMONG the most elusive magnitudes to ,[_1quantify is the influence of technological change on employment, the reason being that technological change in any context has been difficult to isolate. Clearly, the traditional productivity ratios, such as output per unit of labor input, cannot be used to measure technological employment, since a productivity index embodies, in a seemingly indecomposable manner, the effects of in capital utilized, returns to scale, neutral and non-neutral technological change, and relative factor prices. Thus, in order to construct a measure of technological employment, we need to be able to quantify, at the minimum, the effects of in technology separately from the other forces. Yet, these other forces have meaning in themselves. Therefore, we should like to isolate the effect on the change in employment of in the following: (a) the scale of output, (b) the relative prices of capital and labor (assuming, for simplicity, only two factors), (c) returns to scale, and (d) neutral and non-neutral technology.' The present paper presents a method of measuring the forces (a)-(d) on employment and tests it on data for the private domestic non-farm sector of the United States for the period 1890-1958.2 It does this in such a way as to avoid the problem of the interaction among the forces (a)-(d) -at least to a first-order approximation. Stated differently, our objective is to frame a general method of measurement which permits a quantitative distinction to be drawn between structural changes and demand in terms of their effect on employment.8 Since the method is general, the forces (a)-(d) can be quantified for any subset in the total employed; for example, skilled or unskilled labor, regional unemployment, etc. The only requirement is that we be able to estimate a demand relation for the subset in question. We should like to emphasize the methodological rather than the substantive aspects of this paper for several reasons. The principal reason, though, is that the data, by virtue of their aggregative nature (inter alia), are not suitable to the method we will apply. Also, since the method derives from the micro theory of the firm, it should be applied, at most, to industry data. In what follows, the method is first presented verbally as far as possible. This is followed by a more precise statement of the method which permits a confrontation with data. The empirical measures of the private domestic non-farm sector are then set out and discussed. An appendix embodies a discussion of the data used in the paper.