ABSTRACT
One common assumption of the models concerned with finance and development is that saving is a pre-condition to investment and economic growth - a view which was called the prior-saving (PS) argument in the introduction to this book. The PS argument has had both theoretical and policy consequences for development economics. From the theoretical perspective, it implies a hierarchy in the dynamics of a capitalist economy: savers, as suppliers of saving/capital, ultimately determine the pace of accumulation.’
