Capital and Interest (German: Kapital und Kapitalzins) is a three-volume work on finance published by Austrian economist Eugen Böhm von Bawerk. Translator’s Preface↩. My only reasons for writing a preface to a work so exhaustive, and in itself so lucid, as Professor Böhm-Bawerk’s Kapital und Kapitalzins. Capital and Interest (LvMI) – Kindle edition by Eugen von Böhm-Bawerk, William Smart. Download it once and read it on your Kindle device, PC, phones or.

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What labour does is to produce a quantity of commodities, and what capital co-operating with labour usually does is to increase that quantity. Moreover, the context often makes it doubtful whether they object to interest as such, or only to an excess of it; and, in the former case, whether their objection is on the ground of a peculiar blot inherent in interest itself, or only because it usually favours the riches they despise.

But we must remember that this connection only entitles us to bring together the results; it does not justify us in confusing the investigations.

Of greater importance is the second phase, although neither as regards the number of its inferest nor the very imposing bobm of arguments they introduced. In compass, inasmuch as all forms and varieties of interest must be explained.

Pope Clement V, at the Council of Vienna incould go so far as to threaten with excommunication those secular magistrates who passed laws favourable to interest, or who did not repeal such laws, where already passed, within three months.

At last even the temporal legislation succumbed to the Church’s influence, and gave its severe statutes the sanction of Roman law. But the explanation must be complete both in compass and in depth.

ComiXology Thousands of Digital Comics. On this account it is inadmissible and unfair to take anything over and above the lent sum for the use of the same, since this is not so much taken from money, which brings forth no fruit, as from the industry of another.

He pays it ex proventu, out of the gain that he makes with the money.

Now as the use of money lies in its consumption or inherest its spending, it is inadmissible in itself, on the same grounds, to ask a price for the use of money.


About the twelfth century of our era is observable a noteworthy departure in the character of this literature. First of all, it is necessary and useful that a certain practice of taking interest be retained and permitted.

Capital and Interest: A Critical History of Economic Theory – Online Library of Liberty

It is a critical history of interest doctrines that defend or oppose capital income. The exploitation of poor debtors by rich creditors must have appeared in a peculiarly hateful light to one whose religion taught him to look upon gentleness and charity as among the greatest virtues, and to think little of the goods of this world. It may with reason appear questionable if the entire profit realised by an undertaker from a process of production should be put to the account of his capital.

It’s not only economics being addressed here. To modify them in some degree—as a Catholic might be compelled to do from other considerations—he makes certain practical concessions, without, however, yielding anything in principle. Much more frequently is it the case that attention is first attracted by some particularly striking instance, and it is only gradually that the less striking phenomena come to be recognised as belonging to the same group, and are included in the compass of the growing problem.

That this natural profit might be an income distinct from that due to the undertaker for his labour, was but little noticed, especially at the beginning of the period; and, so far as it was noticed, little thought was given to it. Notwithstanding this limitation of subject, there will be no lack of material for a critical history, either as regards the historical or as regards the critical part. On one or other of these grounds, the capitalist is said to deserve a remuneration, and this remuneration is obtained by him in the shape of interest.

The more complete development of the conception of capital I reserve for a future occasion. Learn more about Amazon Prime. View the discussion thread. It cannot be too often reiterated that the theory which explains interest must explain surplus value— not a surplus of products which may obtain value and may not; not a surplus of value over the amount of value produced by labour unassisted by capital; but a surplus of value in the product of capital over the value of the capital consumed in producing it.

The essential difference between the two transactions is that, on 1st January the price of the plane is another similar plane; on the 31st December it is a plane plus a plank.


It is generally called Interest when the capital consists of perishable or fungible goods. If, however, we demand an answer to what we have formulated as the true problem of interest, we shall make the discovery that the Productivity theory has not even put that problem before itself. Not only does it indicate an advance, but it long indicates the high-water mark of the advance. Amazon Advertising Find, attract, and engage customers. Considerations like these show that there is constant danger that an unjustifiable use may be made of arguments in themselves justifiable.

Thus he gets his convictions more from impressions he receives than from logical argument. To the observer of men and things it must in time have become questionable whether the obstinate and always increasing resistance of practical life really had its root, as the canonists affirmed, only in human wickedness and hardness of heart.

What one wishes to believe, says an old and true proverb, that one easily believes. In concluding, I should like to say with Dr. What this positively amounts to may be summed up thus: Instead of reducing every activity by a fifth, the farmer simply starved the parrots as they were of less utility than the other four uses, in other words they were on the margin.

Calvin has defined his attitude towards our question in a letter to his friend Oekolampadius. This theory, in fact, affords a striking instance of how our science has revenged itself for our unscientific treatment of it.

Online Library of Liberty

Any one who has realised the difficulty of the wages question will understand that this underpaying may be quite unintentional. Sonnenfels’s contempt for the canon doctrine carries all the more weight that he has nothing good to say of interest in other respects. What other items do customers buy after viewing this item? Human labour, employing itself on the materials given free by nature, and making use of no powers beyond the natural forces which manifest themselves alike in the labourer and in his environment, can always produce a certain amount of wealth.