ABSTRACT
Economic growth depends upon the interplay of productive potential and of effective demand. The chapter is concerned with productive potential rather than with effective demand. It engages in asking what the effects are in a fully competitive economy of population growth, capital accumulation, and technical progress on the output. The chapter provides always that a market can be found for the products. It is concerned with a proper investigation of the problems of defining and maintaining the most appropriate level of money demand to achieve the fullest use of the real opportunities of growth. Some loans will be for long periods, some for short periods; and the rates of interest at which the various forms of loan are made will be determined by competition between borrowers and lenders. The chapter explores all sorts of firms and institutions growing up in what we may call the Money and Capital Market.
