“ When a man buys an investment or capital-asset, he purchases the right to the series of prospective returns, which he expects to obtain from selling its output, after deducting the running expenses of obtaining that output, during the life of the asset. ”
John Maynard Keynes, The General Theory of Employment, Interest and Money (1936). copy citation
Author | John Maynard Keynes |
---|---|
Source | The General Theory of Employment, Interest and Money |
Topic | investment output |
Date | 1936 |
Language | English |
Reference | |
Note | |
Weblink | http://gutenberg.net.au/ebooks03/0300071h/printall.html |
Context
“We have to accept them as an inevitable result of applying to the conduct of the State the maxims which are best calculated to 'enrich' an individual by enabling him to pile up claims to enjoyment which he does not intend to exercise at any definite time.
Chapter 11
THE MARGINAL EFFICIENCY OF CAPITAL
I
When a man buys an investment or capital-asset, he purchases the right to the series of prospective returns, which he expects to obtain from selling its output, after deducting the running expenses of obtaining that output, during the life of the asset. This series of annuities Q 1 , Q 2 , . . . Q n it is convenient to call the prospective yield of the investment.
Over against the prospective yield of the investment we have the supply price of the capital-asset, meaning by this, not the market-price at which an asset of the type in question can actually be purchased in the market, but the price which would just induce a manufacturer newly to produce an additional unit of such assets, i.e.”
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