The Keynesian intuition that increasing consumption can stimulate investment is verified empirically using US macroeconomic data. The investment multiplier is hypothesized to increase monotonically with the propensity to consume. However, the functional relationship is not that of the Keynesian...

Capitalism is defined here by the universal concept of private property, independent of time and geography, in purely economic terms, free from political ideology. Capitalism thus defined is antithetical to socialism, for which a metric has been introduced by the size of government measured as...

Key economic concepts of saving and investment are defined and discussed in this paper. It is shown that the equation “saving=investment” is a fundamental fallacy of macroeconomics due to a confusion between real and financial variables, and also between stock and flow variables. Economic...