chapter  59
5 Pages


For us, the composition of the money and investment markets is primarily of interest in so far as it bears on the problem of the interest on capital with which we must concern ourselves under the theory of income. The explanation of interest which we have attempted in the theory of the simple economy is applicable only to that on productive business capital and, in connection with this, to the interest on productive loans. I t is not an adequate explanation to cover interest on natural acquisitive capital or on commodities rented for direct use or on loans secured by these. Nor does the explanation cover interest on capital used for consumptive loans. Each of these capital groups shows in somewhat different form variations of the problem of the interest on capital and thus attains theoretical importance.