Anwar Shaikh and the Classical Theory of Interest: A Critical Note

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Main author: Toporowski, Jan
Format: Journal Article           
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id eprints-31147
recordtype eprints
institution SOAS, University of London
collection SOAS Research Online
language English
language_search English
description The Note examines the theory of interest put forward in Shaikh’s recent book Capitalism, Competition, Conflict, Crises which presents the classic Ricardian theory of interest, in which the rate of interest is determined by the industrial rate of profit, as the basis for the book’s analysis of banking and credit. The Note argues that the classic theory of Anwar Shaikh holds true only under special assumptions, namely when money is a produced commodity, and credit is external to the system of capitalist production. However, in the modern capitalist economy, credit is endogenous to the system of production and distribution. In this more general case, debt and interest have the function of redistributing income, but are unrelated to the rate of profit from production.
format Journal Article
author Toporowski, Jan
author_facet Toporowski, Jan
authorStr Toporowski, Jan
author_letter Toporowski, Jan
title Anwar Shaikh and the Classical Theory of Interest: A Critical Note
publisher Oxford University Press
publishDate 2020
url https://eprints.soas.ac.uk/31147/

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