ABSTRACT
In the Treatise on Money (1930), in a footnote to chapter 12, ‘A further elucidation of the distinction between savings and investment’, Keynes writes:
The notion of the distinction which I have made between savings and investment has been gradually creeping into economic literature in quite recent years. The fi rst author to introduce it was, according to the German authorities, Ludwig Mises in his Theorie des Geldes und der Umlaufsmittel [. . .] published in 1912 [. . .]. Later on the idea was adopted in a more explicit form by Schumpeter, and ‘forced saving’ [. . .] (i.e. the difference between savings and value of investment as defi ned by me, though without there being attached to the idea – so far as I am aware – anything closely corresponding to the analysis of chapters 10 and 11 above) has become almost a familiar feature of the very newest German writings on money. But so far as I am concerned – and I think the same is true of most other economists of the English-speaking world – my indebtedness for clues which have set my mind working in the right direction is to Mr D. H. Robertson’s Banking Policy and the Price Level published in 1926 [. . .]. More recently Mr Abbati’s The Final Buyer (1928), has reached – independently I think – some substantially similar results. Mr Abbati has probably failed to make his thought fully intelligible to those who have not already found the same clue themselves. But the essence of the distinction between saving and investment is to be found in his chapter V. Moreover, by the aggregate of ‘fi nal buying’, Mr Abbati means expenditure on consumption plus investment, and he attributes depressions to a failure of this aggregate to reach the aggregate of money incomes.
