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This possible answer is from a 2004 Working Paper by Gennaro Zezza, Some Simple, Consistent Models of the Monetary Circuit. http://www.levyinstitute.org/pubs/wp405.pdf The Theory of the Monetary Circuit (TMC) has received a growing interest among post-Keynesians in the last two decades. New developments have recently appeared from ...


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The key here is to distinguish between ex ante and ex post concepts of saving and investment. These concepts were defined by the economist Gunnar Myrdal as follows (quoted here): An important distinction exists between prospective and retrospective methods of calculating economic quantities such as incomes, savings, and investments; and [...] a ...


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It is because these two examples use the word investment in different meaning. In the top example, investment means all investment whether it is investment into something productive or inventory investment. In the second graph, the word “investment” is applied to investment minus inventory investment. This is why in the second picture the difference between ...


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