Business cycles and economic growth

345 p., tabl.For years many teachers of economics and other professional economists have felt the need for a series of books on economic subjects which is not filled by the usual textbook, nor by the highly technical treatise. This present series, published under the general title, The Economics Handbook Series, was planned with these needs in mind. Designed first of all for students, the volumes are useful in the ever-growing field of adult education, and also are of interest to the informed general reader. The volumes are not long―they give the essentials of the subject matter within the limits of a few hundred pages; they present a distillate of accepted theory and practice, without the detailed approach of the technical treatise. Each volume is a unit, standing on its own. The authors are scholars, each writing about an economic subject on which he is an authority. In this series the author's first task was not to make important contributions to knowledge―although many of them do - but so to present his subject matter that his work as a scholar will carry its maximum influence outside as well as inside the classroom. The time has come to redress the balance between the energies spent on the creation of new ideas and on their dissemination. Economic ideas are unproductive if they do not spread beyond the world of scholars. Popularizers without technical competence, unqualified textbook writers, and sometimes even charlatans control too large a part of the market for economic ideas. In the classroom The Economics Handbook Series will serve, it is hoped, as brief surveys in one-semester courses, as supplementary reading in introductory courses, and in other courses to which the subject is related. Professor James Duesenberry has written a book on Business Cycles and Economic Growth which will interest all those concerned with the theory and empirical aspects of the problems which used to be dealt with in the study of business cycles. With the great advances, both in theory and fact, Duesenberry's study covers broader issues than those encompassed in the orthodox studies of cycles. Author of a distinguished book on the consumption function, an experienced teacher both at the University of Michigan and Harvard (where he is now professor of economics, working in quantitative economics, cycles, and money and banking), and with experience in business economics as well, Professor Duesenberry is well qualified to write this important book for the Handbook Series. Professor Duesenberry's book has two aims: (1) to present a framework for the analysis of the effects of changes in the economic structure on the rate of growth of income and on the stability of the growth process and (2) to explain the business cycles of the past and, in particular, to explain why the depression of the 1930s was so much greater than its predecessors. The first part of the book is devoted to a detailed discussion of what determines investment and consumption. A chapter is devoted to the influences of corporate financing on business investment and another to the relation of competition to investment. There is also a chapter on housing investment and housing cycles. Duesenberry then uses these results to get a systematic explanation of the growth of demand and the causes of fluctuations. It is argued that past depressions are the result of shocks due to speculative booms and similar factors and not to a repetitive cyclical mechanism