chapter  6
6 Pages

The Big Market versus Sustainability

An extra-long-term schedule of the Basic Ratio schematized and scheduled as the normative and analogical Optimal Development Path (ODP), portrays the changing interactions between the general societal trends in the people's orientation to the future and the economy-specific trend in the future orientation. Michio Morishima, being a neoclassical economist, declares in his Modern Economics as an Idea that demand does not adjust to supply in the real world. Irving Fisher assumes perfect competition in his theory of interest, the market forces tend to bring about the saving-investment equilibrium, as well as the equilibrium market rate of interest equal to the average time-preference rate and the average productivity. The lead-lag assumption specific to the relationship between the Trend Preference Rate (T) and the Trend Interest Rate (r), therefore, implies the lead-lag interactions between the Social Rate of Interest (SRI) and the Economic Rate of Interest (ERI), where the portion of lag refers to the Social Premium for Development (SPD).