SAVE OR SPEND ?
[To the Editor of the SPECTATOR.] Sia,—Professor Robbins seeks to minimize his admission of a time lag in the passage of new savings into investment. But his admission is fatal to the case he is arguing, for it can only mean that from the standpoint of the entrepreneur there already exists an excessive quantity of production capital—the result of prior over-investment. He imputes to me " the conviction that real investment at this juncture is inopportune." But it is not a question of my conviction. The business situation attests this inopportuneness, i.e. entrepreneurs rightly believe that more real investment could not be profitably employed. I agree with Professor Robbins that the cessation of investment is " partly due to maladjustments brought about during the boom period," but I hold that he ignores the chief maladjustment, that between the volume of productive energy put to making and selling capital-goods and that put to making and selling consumption - goods. But then I gather from other sources that consumption has no proper place in Professor Robbins'
Previous page
