In this paper I critically analyze Smith's thesis in book I, chapter 6 of the "Wealth of Nations" that the replacement of the capital goods consumed in production becomes fully income. I argue that Smithٳ argument is defective and does not imply this, and that, once it is properly corrected, it...

In this paper I critically analyze the relationship that professors Dornbusch and Fischer establish among the concepts of GNP, NNP and aggregate income. In principle, aggregate income is NNP; indeed, the whole point of introducing the concept of NNP is to determine what is the income of the...