Capital and Interest (German: Kapital und Kapitalzins) is a three-volume work on finance published by Austrian economist Eugen Böhm von Bawerk. Translator’s Preface↩. My only reasons for writing a preface to a work so exhaustive, and in itself so lucid, as Professor Böhm-Bawerk’s Kapital und Kapitalzins. Capital and Interest (LvMI) – Kindle edition by Eugen von Böhm-Bawerk, William Smart. Download it once and read it on your Kindle device, PC, phones or.

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It might be advisable, however, to put his theory into concrete terms. And this investigation could not be one that was content to point out the obvious and striking forms of the phenomenon, but one that would cast light on its more homely forms. In replying to this latter argument Salmasius gets an opportunity of cpital the use of competition.

In the fifth edition published he refers to it, indeed, but in the kind of tone which one usually adopts towards a foregone conclusion. Now as the use of baserk lies in its consumption or in its spending, it is inadmissible in itself, on the same grounds, to ask a price for the use of money. He will let his judgment as to the causes of the phenomenon of interest be guided, to some extent, by principles of expediency—which is wholly and entirely bad; and he will let his judgment as to the advantages of interest as an institution be, to some extent, directly guided by purely theoretical considerations—which, at least, may be bad.

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It is often assumed that, if a labouring man during his week’s work consumes the value of, say 20s. And the more flourishing the economical condition of a country the stronger was the reaction of practice against the dominant theory.

This task naturally fell to the theological and legal literature of the Church, and thus began a literary movement on the subject of loan interest which accompanied the canonist prohibition from its earliest rise far into the eighteenth century. As things are, he pays nothing on 1st January; he has the use of the plane over the year; by 31st December the plane is consumed; and next day he has to pay over to James a precisely similar plane plus a plank.

Share your thoughts with other customers. These are the essential features of Salmasius’s doctrine. In the one case the argument is concerned with truth or falsehood, while in the other it is concerned for the most part with expediency. Both writers agree in their principles, but the way in which they state them differs as widely as do their callings.


The first efforts to accumulate capital must be attended by sacrifice; a temporary sacrifice, of course, to secure a permanent gain, but, in the first instance at least, a material sacrifice. The canon doctrine of interest had to all appearance reached its zenith sometime during the thirteenth century. This again suggests a very different source of interest, viz.

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It has often been remarked that not only does our knowledge of interesting subjects gradually develop, but also our curiosity regarding these subjects. Finally, he is as little impressed by the passages in Holy Writ which have hawerk interpreted as forbidding interest p.

In view of the unsatisfactoriness of the answers hitherto given to our problem it is easy to see how another answer would arise.

Page 1 of 1 Start over Page 1 of 1. Get fast, free shipping with Amazon Prime. ComiXology Thousands of Digital Comics. To the question as to the causes of interest there can be only one answer, and its truth every one must recognise if the laws of thought are correctly applied. He points out very well that the height of loan interest must at all times correspond with the height of natural interest, the latter indeed being the ground and source of the former; and he maintains that, where, owing to the use of money, the current rate of profit is higher, a higher limit of loan interest should be allowed p.

As distinct as the nature of the two problems is the character of the arguments that are used by each of them, and the strictness with which the arguments are used. Within this general conception of capital, further, there are two well-known shades of difference that require to be noted. In this battle victory remained with the more stubborn party, and that party was the one whose very existence was endangered by the prohibition.

We must not regard the first immediate spending of the money as its use: The goal of each section is to present the fairest possible case for the theory, examines its claims in detail, and finally reveals its most profound errors. What labour does is to produce a quantity of commodities, and what capital co-operating with labour usually does is to increase that quantity. Also included was a critique of Marx ‘s exploitation theory. The philosophic writers, again—like Plato, Aristotle, the two Catos, Cicero, Seneca, Plautus, and others—usually touch on the subject too cursorily to give any foundation in theory for their unfavourable judgment.


First of all, we meet with Aristotle’s argument of the barrenness of money; only that the theoretically important point of interest being a parasite on the produce of other people’s industry, is more sharply brought out by the canonists. In loan interest, and specially in loan interest derived from sums of money that are by nature barren, this characteristic is so peculiarly noticeable that it must excite question even where no close attention has been given it.

A labourer allowed free access to land, as in a new country, can produce enough to support himself and the average family, and have besides a surplus over. Exactly in the same way is it unjust for a man to lend things of this sort at interest.

It is the fathers of the Church who express themselves most thoroughly on the subject, although even their treatment can scarcely be called thorough. Any return above this level we should consider, either as due to the insecurity of the capital as invested i.

In all production labour sacrifices life, and capital sacrifices immediate enjoyment. Amazon Renewed Refurbished products with a warranty. The crushing confutation of the Labour Value theory is work that will not require to be done twice in economic science, and the vindication of interest as a price for an economic service or good suggested by the very nature of things “which may be modified but cannot be prevented” will necessitate reconsideration by the Socialist party of their official economic basis.

Not one, nor two, nor three, but a round dozen of interest theories testify to the zeal with which economists have devoted themselves to the investigation of this remarkable problem.

The rest of the polemic against the canonists has little theoretical interest. Is not the interest made possible by the qualities of the tools?

Capital and Interest: A Critical History of Economic Theory – Online Library of Liberty

But there was no essential advance on Salmasius till the time of Smith and Turgot. Value cannot come from production. In the social and political question there naturally come into play all sorts of wishes, inclinations, an passions.