to with regard to the Bohm-Bawerkian model of roundaboutness
Is Not a Mysterious Concept: A Financial Application to Capital Theory.
Although extended production time or additional "stages" of production make convenient placeholders for increased roundaboutness
, they fail to grasp the core concept as it pertains to capital theory: what is it about production processes that makes more or better consumer goods?
boost economic growth--is by increasing the "roundaboutness
" of its methods of production.
For this reason, Austrians commonly refer to production as a roundabout process, where the degree of roundaboutness
denotes the length of time it takes to transform raw inputs into final goods and services.
And, when you talk of roundaboutness
, I suppose you'resaying that the circle, or rather spiral stair, is just as important asthe center, the moving just as nice (at times anyway) not to say asnecessary, as standing still.
First, although it takes a different form, the traditional Wicksellian claim that it is possible to order the different production methods according to their degree of 'roundaboutness
' is still there: when the rate of interest decreases, the 'tilting' (Hicks 1946 : 216-17) of the production plan to the right causes the average time-lag between inputs ('investment goods' in capital), and outputs, to increase.
The "directness" or "roundaboutness
" of a procedure is a metacognitive judgment.
" is a concept featured in Austrian capital theory.
And for all its roundaboutness
it is grounded in our understanding of how things are.
These facts highlight the importance of banks as the initial propagation mechanisms of the Asia crisis as well as the "roundaboutness
" of the banking flows.