In this article we will discuss about:- 1. Assumptions of Classical Theory of Interest 2. Supply and Demand for Capital 3. Determination of Rate of Interest 4. Features of Classical Theory 5. Criticisms. The economists like Ricardo, J. S. Mill, Marshall and Pigou developed the, classical theory of interest which is also known as the capital theory of interest or [...]
In this article we will discuss about:- 1. Comparative Costs Theory Expressed in Money Terms— Taussig's Contribution 2. Taussig's Refinement Related to Non-Competing Groups 3. Taussig's Refinement Related to Charges on Capital. Comparative Costs Theory Expressed in Money Terms— Taussig's Contribution: In the Ricardian comparative costs principle, an assumption is taken that money does not exist and production is measured [...]
In this article we will discuss about the critical and empirical evaluation of comparative costs theory. The complexities and peculiarities of international trade necessitated the separate treatment of international trade from the domestic or interregional trade. The classical theorists tried to create a theoretical structure to deal with such fundamental issues as why different countries engage themselves in trade; which [...]