ABSTRACT
This chapter discusses the influence of factors which were abstracted in the preceding essay in order to obtain a "pure" business cycle in a trendless economy. It is frequently maintained that the main reason for trend is the rise in population or the increase in productivity due to technical progress. No doubt one or the other is a necessary condition for a long-run expansion of output of an economy which has no large reserve army of unemployed. The rising trend in the volume of capital need not be accompanied by a similar trend in the rate of investment. Statistics of net investment in fixed capital in The payment of doles for unemployed, if financed by Government borrowing, will constitute another channel through which the rise in population may cause a positive trend of the system.
