ABSTRACT
THE MODERN theory of employment as well as of economic fluctuations runs in terms of an analysis of the savings-investment process. Consumption and investment are the two most important strategic variables in the determination of aggregate income and employment. An appraisal of non-Keynesian theories of savings and investment will serve as a background against which the Keynesian theory of the savings-investment plan may be better understood. For this reason it is useful to examine the classical savings-investment theory and the underconsumption theory and to indicate wherein these theories differ significantly from the modern theory of saving and investment.
