Reviews the book "A Study in Liquidity," by William A. Paton.

The thesis of this paper is that research is one of the primary responsibilities of university faculties and is an integral part of developing scholars and teachers. Yet no matter how vigorously all concerned may agree with this, research is often placed low in the order of priority. Still, in final analysis, published research plays a vital part in the lives of many university teachers. Despite the abuses which are sometimes committed in the name of research, and the odds and ends which masquerade under the name, published research is one tangible factor which can be appraised by many and is commonly given important recognition. Perhaps the most important general consideration is that a faculty member has an obligation to enrich, to the best of his ability the literature of his field. In return, his contribution cannot help but assist in his own development as an individual and as a scholar.

I. Introduction, contributions to investment theory, 61. — II. Capital inputs in production theory, 62. — III. Production, using capital goods, with a fixed replacement policy, 66. — IV. Replacement theory, 72. — V. A theory of investment, replacement, and production, 77. — VI. “Overcapacity” and the dynamics of production, 80.— VII. Investment demand and the “acceleration principle,” 83. — VIII. Summary, 86.

I. Introduction, 533. — II. Financial intermediaries and commercial banks, 533. — III. Possible destabilizing effects of intermediaries, 538; substitutions between money and intermediary claims, 540; portfolio shifts by intermediaries, 546. — IV. Concluding comments, 551.

Peer Reviewed