-
Title
-
Letter to P.C. Mahalanobis
-
Description
-
Annex: copy of the same letter.
-
Date
-
1954
-
Date in document
-
yes
-
Formulas or calculations
-
no
-
Inventory number
-
NL-RtEUR_TBCOR01_028A018
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7347
-
Storage location
-
Specifiek Magazijn
-
Filename
-
CDM7347_NL-RtEUR_TBCOR01_028A018.pdf
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Provenance
-
Jan Tinbergen
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Accrual Method
-
donation
-
Revised transcript
-
en
Afschrift
PROF. DR J. TINBERGEN THE HAGUE, 18 August 1954 Sijzenlaan 41
Professor P.C. MAHALANOBIS F.R.S. 8, King George Avenue, New Delhi 2
Dear Professor Mahalanobis,
As I wrote to you in my previous letter I had the pleasure of discussing with Dr Mukherjee the problems involved in your development model, and I would like to present a short comment using the usual symbols for the economic variables and your symbols for the co-efficients.
Variables : Y national income = C + I (1)
C consumption
M investment in machines for consumer goods industries
E investment in equipment for investment goods industries
I total investment = M + E (2)
Equations : Apart from the two already mentioned there are two technical equations,
? = ?c M (3)
? = ?i E (4)
There has to be one more equation between the 5 variables, for which you chose an equation M = ?c I (5) and I am inclined to choose I = ? Y (5')
I think we can agree on assuming the two ?'s to be constants; my preference would be in addition to assume ? to be constant, representing the saving ratio of the country whereas you seem to prefer to introduce ?c as a constant which implies that ? would not be a constant. My difficulty may be formulated in this way that I do not see any economic meaning in ?c whereas the meaning of ? is clear to me, as there has been observed a constancy in ? over averages of business cycles which would make it an easy starting point for analysis. It is true, however, that this constancy need not prevail in the future, especially if we may hope for important capital imports. Even in this latter case, however, I do not see any reason to consider ?c to be constant. I do see, however, the desirability of investigating alternative developments which may be conceivable by changing certain instruments of economic policy. In such a case I prefer tot specify and define beforehand what instruments of economic policy would have to be considered.
Yours very sincerely,
-
annexCount
-
1
-
extracted text
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
-^i^c^ ^a.rr-"i-uA
Hü .'t
.a.H.'y
-LO-ÏI
^ iriïsü" w©H
taiüüfiBlBriB.,: l o a a s ' l o ' ï ' ï
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I + 0 = amooiii .'
•:;:•!;
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a + M = j-.a.,iJt;3YXii XöJ-od"
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i"^'''
rfo
-^^c •
ilÖï^fiw ad-nsmgoIsvajLj
.. o BX
.
— .
^noo© lo ad-naaio-id-eni
^mmn&mjiSSEil
o l é d éattap
bOB -^^ioöga toi
(•i-i')
,tf©rc©onia -^t©^ aitfoY
PROP, m J, fwwmm
«
wm§
J» A»post I'^^i»
8» King QSOV0» Avanos»
Dssy Piufsawt MshslsmoMs»
As I iwots to ye» in «r fw^iows I s t t s r X ii** « h s ^ ^
plsssurs of disoussing with Or MUM» ths proiasms tmO^mA
in yoor drvslopratait m>asXf snd Ï «oula l i k t to pfsssnt a
short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
Variablss
t Y
nstlsiiBl lasons » C 4 Z
(1)
0
sonM^ptisn
li
tniPSStiitsAt in fflsghinss tt»
aonsiMsr goods inOastriss
B
iavsstmsnt in sgjEUIoPBiaBt foot
inTsstwoiEt «BOOS iadastriss
Z
total im—tosnt « K • X
(2)
XcMstioas
t Apeoft frwa tUs t»s slrsatfy wsnttsnsd
thsrs ars tue tsohnioal s<|ueti«os»
émmu
(3)
t . 0^ X
M
Thsrs isas to lis SOS novs «qpstlsn
bstussn nm $ "vwlstolss fw w/tdMk p w
(5)
sboas «I s^Astisa li « 1u X
snd Z «a iwsHnsd to *
^ .^
^^tiooss Z » S(Y
(9*)
Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
:nu
•«•«•«
fv
ril
'fp l l t - « « « « * 4k#iMnr I mA
• i i j « > ^ «ltd
loXvnb
•.^-.
t» me
>?
(O
aKl>lJ-.:ai
A
iR ai«Tit-''cT r"ênff> ''srf f
('^)
£'S
Ji^f-
i;n« «•«
«» I
:iA £«i£l|lll
««5-
ifiV • »
'^
'^H^F ^(Ww
^W^^^WI^P
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
-^i^c^ ^a.rr-"i-uA
Hü .'t
.a.H.'y
-LO-ÏI
^ iriïsü" w©H
taiüüfiBlBriB.,: l o a a s ' l o ' ï ' ï
IBSQ.
^ I d o i q arid-r:
.w
^ . w „ V J.CT OCT
9 2 l i i
^•^..•^..
_.
j^ij.-
5 _.>^J.^^yi^.
oimonoos silJ- 1 0 Ï eIoana:a iBuaxr sdt
. a c t ' n a i o x ' i l a - o o 9;
. alcont^a
^^
I + 0 = amooiii .'
•:;:•!;
aoxJ-^.
.00
' l o l asniiloBBf, a l d-naflKfaernl
aai' '
'
no'i .
li
a9iiJaxJi)ai
.^rsiïasvni
(^)
a + M = j-.a.,iJt;3YXii XöJ-od"
D8;
J.*^^
^SJJOX XJUJO
Y
0
M
00 3"T:
agltfBi-iöv
:9ldBi'IBV
a
I
,aoxj;:
c '
a _j.£i - I
noi^J-BXTpa, eioiti ©no ©a" oJ SBXI 9TeriT
-!xo"^ «[3il|wi©'l^èeIcfBi«|a.v g etd*
a
-Ï---J?-—-"^
ÏT0lt;R;jD9
n.-:
a.-iiO
^e.
OJ i)3:iXloax :,IB I LriB
('e:
Y » = I ©aoorio
a ' ^ owd" ©lid- gninaraaa n o
0 ©w
oJ- noid-x'Me n± ©cT f)Xx;c"^ --'
0x0 Bi -gnxvBa ©lid- anxdi
,.
O * 30
9o:ji)OT:d-nx Qd" «ïö-lsiq ad' me©a JJO^ •
JO ©fiJ '10
B 90" d^on ÊIuow X) d'flrfd' aai/'-'^^''iL'O B aB X
oBiid' -^jBW airfd' cii Égd-^^Iirrfniol ©o
•i ,JnBo3fl:oo
©rid- asaisxiw X n i gninBsm oi:;ionoo9 YHB ©aa d-on oJb I
Iisvigacfo nascf asxl eisrid' (F.^.&'fi .©m od- i B a l o a i » I c --•- —
xioiriw a a l o ^ o aasnxajjcf l o BSSX'TOVB l a v o n n i y o
d-I .aJjaYlBnB l o l d-nioq gnid-isd-e V 3 B 9 CIB tï sji&m B1
fx. •y!=^'<-rr d-on i)Qan yoJ^Bd'anoo airid- d-BriJ- ,i©v©wo£t,©£r!d" b..
xr 10*3: ©^öfl YJ»ni ©yr ï i TcIIciooqaa «stwd-f/* ©rfd" rri
01) i . t^^
' «©asQ i&ftsl
airid- n i n©va . a
oJEi';i|:.ji:
^00 ©cf'DdX "ïayóianoo od- nosBc .,. ,. ... .-^c, .
&V'i-êÊlÈmit& snid-BiEiid'^e&'rai ï® y,ctx£ic[B'ï±a-9lJ ^ i ,T[ov©wofl ,
i"^'''
rfo
-^^c •
ilÖï^fiw ad-nsmgoIsvajLj
.. o BX
.
— .
^noo© lo ad-naaio-id-eni
^mmn&mjiSSEil
o l é d éattap
bOB -^^ioöga toi
(•i-i')
,tf©rc©onia -^t©^ aitfoY
PROP, m J, fwwmm
«
wm§
J» A»post I'^^i»
8» King QSOV0» Avanos»
Dssy Piufsawt MshslsmoMs»
As I iwots to ye» in «r fw^iows I s t t s r X ii** « h s ^ ^
plsssurs of disoussing with Or MUM» ths proiasms tmO^mA
in yoor drvslopratait m>asXf snd Ï «oula l i k t to pfsssnt a
short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
Variablss
t Y
nstlsiiBl lasons » C 4 Z
(1)
0
sonM^ptisn
li
tniPSStiitsAt in fflsghinss tt»
aonsiMsr goods inOastriss
B
iavsstmsnt in sgjEUIoPBiaBt foot
inTsstwoiEt «BOOS iadastriss
Z
total im—tosnt « K • X
(2)
XcMstioas
t Apeoft frwa tUs t»s slrsatfy wsnttsnsd
thsrs ars tue tsohnioal s<|ueti«os»
émmu
(3)
t . 0^ X
M
Thsrs isas to lis SOS novs «qpstlsn
bstussn nm $ "vwlstolss fw w/tdMk p w
(5)
sboas «I s^Astisa li « 1u X
snd Z «a iwsHnsd to *
^ .^
^^tiooss Z » S(Y
(9*)
Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
:nu
•«•«•«
fv
ril
'fp l l t - « « « « * 4k#iMnr I mA
• i i j « > ^ «ltd
loXvnb
•.^-.
t» me
>?
(O
aKl>lJ-.:ai
A
iR ai«Tit-''cT r"ênff> ''srf f
('^)
£'S
Ji^f-
i;n« «•«
«» I
:iA £«i£l|lll
««5-
ifiV • »
'^
'^H^F ^(Ww
^W^^^WI^P
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
-^i^c^ ^a.rr-"i-uA
Hü .'t
.a.H.'y
-LO-ÏI
^ iriïsü" w©H
taiüüfiBlBriB.,: l o a a s ' l o ' ï ' ï
IBSQ.
^ I d o i q arid-r:
.w
^ . w „ V J.CT OCT
9 2 l i i
^•^..•^..
_.
j^ij.-
5 _.>^J.^^yi^.
oimonoos silJ- 1 0 Ï eIoana:a iBuaxr sdt
. a c t ' n a i o x ' i l a - o o 9;
. alcont^a
^^
I + 0 = amooiii .'
•:;:•!;
aoxJ-^.
.00
' l o l asniiloBBf, a l d-naflKfaernl
aai' '
'
no'i .
li
a9iiJaxJi)ai
.^rsiïasvni
(^)
a + M = j-.a.,iJt;3YXii XöJ-od"
D8;
J.*^^
^SJJOX XJUJO
Y
0
M
00 3"T:
agltfBi-iöv
:9ldBi'IBV
a
I
,aoxj;:
c '
a _j.£i - I
noi^J-BXTpa, eioiti ©no ©a" oJ SBXI 9TeriT
-!xo"^ «[3il|wi©'l^èeIcfBi«|a.v g etd*
a
-Ï---J?-—-"^
ÏT0lt;R;jD9
n.-:
a.-iiO
^e.
OJ i)3:iXloax :,IB I LriB
('e:
Y » = I ©aoorio
a ' ^ owd" ©lid- gninaraaa n o
0 ©w
oJ- noid-x'Me n± ©cT f)Xx;c"^ --'
0x0 Bi -gnxvBa ©lid- anxdi
,.
O * 30
9o:ji)OT:d-nx Qd" «ïö-lsiq ad' me©a JJO^ •
JO ©fiJ '10
B 90" d^on ÊIuow X) d'flrfd' aai/'-'^^''iL'O B aB X
oBiid' -^jBW airfd' cii Égd-^^Iirrfniol ©o
•i ,JnBo3fl:oo
©rid- asaisxiw X n i gninBsm oi:;ionoo9 YHB ©aa d-on oJb I
Iisvigacfo nascf asxl eisrid' (F.^.&'fi .©m od- i B a l o a i » I c --•- —
xioiriw a a l o ^ o aasnxajjcf l o BSSX'TOVB l a v o n n i y o
d-I .aJjaYlBnB l o l d-nioq gnid-isd-e V 3 B 9 CIB tï sji&m B1
fx. •y!=^'<-rr d-on i)Qan yoJ^Bd'anoo airid- d-BriJ- ,i©v©wo£t,©£r!d" b..
xr 10*3: ©^öfl YJ»ni ©yr ï i TcIIciooqaa «stwd-f/* ©rfd" rri
01) i . t^^
' «©asQ i&ftsl
airid- n i n©va . a
oJEi';i|:.ji:
^00 ©cf'DdX "ïayóianoo od- nosBc .,. ,. ... .-^c, .
&V'i-êÊlÈmit& snid-BiEiid'^e&'rai ï® y,ctx£ic[B'ï±a-9lJ ^ i ,T[ov©wofl ,
i"^'''
rfo
-^^c •
ilÖï^fiw ad-nsmgoIsvajLj
.. o BX
.
— .
^noo© lo ad-naaio-id-eni
^mmn&mjiSSEil
o l é d éattap
bOB -^^ioöga toi
(•i-i')
,tf©rc©onia -^t©^ aitfoY
PROP, m J, fwwmm
«
wm§
J» A»post I'^^i»
8» King QSOV0» Avanos»
Dssy Piufsawt MshslsmoMs»
As I iwots to ye» in «r fw^iows I s t t s r X ii** « h s ^ ^
plsssurs of disoussing with Or MUM» ths proiasms tmO^mA
in yoor drvslopratait m>asXf snd Ï «oula l i k t to pfsssnt a
short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
Variablss
t Y
nstlsiiBl lasons » C 4 Z
(1)
0
sonM^ptisn
li
tniPSStiitsAt in fflsghinss tt»
aonsiMsr goods inOastriss
B
iavsstmsnt in sgjEUIoPBiaBt foot
inTsstwoiEt «BOOS iadastriss
Z
total im—tosnt « K • X
(2)
XcMstioas
t Apeoft frwa tUs t»s slrsatfy wsnttsnsd
thsrs ars tue tsohnioal s<|ueti«os»
émmu
(3)
t . 0^ X
M
Thsrs isas to lis SOS novs «qpstlsn
bstussn nm $ "vwlstolss fw w/tdMk p w
(5)
sboas «I s^Astisa li « 1u X
snd Z «a iwsHnsd to *
^ .^
^^tiooss Z » S(Y
(9*)
Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
:nu
•«•«•«
fv
ril
'fp l l t - « « « « * 4k#iMnr I mA
• i i j « > ^ «ltd
loXvnb
•.^-.
t» me
>?
(O
aKl>lJ-.:ai
A
iR ai«Tit-''cT r"ênff> ''srf f
('^)
£'S
Ji^f-
i;n« «•«
«» I
:iA £«i£l|lll
««5-
ifiV • »
'^
'^H^F ^(Ww
^W^^^WI^P
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
-^i^c^ ^a.rr-"i-uA
Hü .'t
.a.H.'y
-LO-ÏI
^ iriïsü" w©H
taiüüfiBlBriB.,: l o a a s ' l o ' ï ' ï
IBSQ.
^ I d o i q arid-r:
.w
^ . w „ V J.CT OCT
9 2 l i i
^•^..•^..
_.
j^ij.-
5 _.>^J.^^yi^.
oimonoos silJ- 1 0 Ï eIoana:a iBuaxr sdt
. a c t ' n a i o x ' i l a - o o 9;
. alcont^a
^^
I + 0 = amooiii .'
•:;:•!;
aoxJ-^.
.00
' l o l asniiloBBf, a l d-naflKfaernl
aai' '
'
no'i .
li
a9iiJaxJi)ai
.^rsiïasvni
(^)
a + M = j-.a.,iJt;3YXii XöJ-od"
D8;
J.*^^
^SJJOX XJUJO
Y
0
M
00 3"T:
agltfBi-iöv
:9ldBi'IBV
a
I
,aoxj;:
c '
a _j.£i - I
noi^J-BXTpa, eioiti ©no ©a" oJ SBXI 9TeriT
-!xo"^ «[3il|wi©'l^èeIcfBi«|a.v g etd*
a
-Ï---J?-—-"^
ÏT0lt;R;jD9
n.-:
a.-iiO
^e.
OJ i)3:iXloax :,IB I LriB
('e:
Y » = I ©aoorio
a ' ^ owd" ©lid- gninaraaa n o
0 ©w
oJ- noid-x'Me n± ©cT f)Xx;c"^ --'
0x0 Bi -gnxvBa ©lid- anxdi
,.
O * 30
9o:ji)OT:d-nx Qd" «ïö-lsiq ad' me©a JJO^ •
JO ©fiJ '10
B 90" d^on ÊIuow X) d'flrfd' aai/'-'^^''iL'O B aB X
oBiid' -^jBW airfd' cii Égd-^^Iirrfniol ©o
•i ,JnBo3fl:oo
©rid- asaisxiw X n i gninBsm oi:;ionoo9 YHB ©aa d-on oJb I
Iisvigacfo nascf asxl eisrid' (F.^.&'fi .©m od- i B a l o a i » I c --•- —
xioiriw a a l o ^ o aasnxajjcf l o BSSX'TOVB l a v o n n i y o
d-I .aJjaYlBnB l o l d-nioq gnid-isd-e V 3 B 9 CIB tï sji&m B1
fx. •y!=^'<-rr d-on i)Qan yoJ^Bd'anoo airid- d-BriJ- ,i©v©wo£t,©£r!d" b..
xr 10*3: ©^öfl YJ»ni ©yr ï i TcIIciooqaa «stwd-f/* ©rfd" rri
01) i . t^^
' «©asQ i&ftsl
airid- n i n©va . a
oJEi';i|:.ji:
^00 ©cf'DdX "ïayóianoo od- nosBc .,. ,. ... .-^c, .
&V'i-êÊlÈmit& snid-BiEiid'^e&'rai ï® y,ctx£ic[B'ï±a-9lJ ^ i ,T[ov©wofl ,
i"^'''
rfo
-^^c •
ilÖï^fiw ad-nsmgoIsvajLj
.. o BX
.
— .
^noo© lo ad-naaio-id-eni
^mmn&mjiSSEil
o l é d éattap
bOB -^^ioöga toi
(•i-i')
,tf©rc©onia -^t©^ aitfoY
PROP, m J, fwwmm
«
wm§
J» A»post I'^^i»
8» King QSOV0» Avanos»
Dssy Piufsawt MshslsmoMs»
As I iwots to ye» in «r fw^iows I s t t s r X ii** « h s ^ ^
plsssurs of disoussing with Or MUM» ths proiasms tmO^mA
in yoor drvslopratait m>asXf snd Ï «oula l i k t to pfsssnt a
short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
Variablss
t Y
nstlsiiBl lasons » C 4 Z
(1)
0
sonM^ptisn
li
tniPSStiitsAt in fflsghinss tt»
aonsiMsr goods inOastriss
B
iavsstmsnt in sgjEUIoPBiaBt foot
inTsstwoiEt «BOOS iadastriss
Z
total im—tosnt « K • X
(2)
XcMstioas
t Apeoft frwa tUs t»s slrsatfy wsnttsnsd
thsrs ars tue tsohnioal s<|ueti«os»
émmu
(3)
t . 0^ X
M
Thsrs isas to lis SOS novs «qpstlsn
bstussn nm $ "vwlstolss fw w/tdMk p w
(5)
sboas «I s^Astisa li « 1u X
snd Z «a iwsHnsd to *
^ .^
^^tiooss Z » S(Y
(9*)
Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
:nu
•«•«•«
fv
ril
'fp l l t - « « « « * 4k#iMnr I mA
• i i j « > ^ «ltd
loXvnb
•.^-.
t» me
>?
(O
aKl>lJ-.:ai
A
iR ai«Tit-''cT r"ênff> ''srf f
('^)
£'S
Ji^f-
i;n« «•«
«» I
:iA £«i£l|lll
««5-
ifiV • »
'^
'^H^F ^(Ww
^W^^^WI^P
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
-^i^c^ ^a.rr-"i-uA
Hü .'t
.a.H.'y
-LO-ÏI
^ iriïsü" w©H
taiüüfiBlBriB.,: l o a a s ' l o ' ï ' ï
IBSQ.
^ I d o i q arid-r:
.w
^ . w „ V J.CT OCT
9 2 l i i
^•^..•^..
_.
j^ij.-
5 _.>^J.^^yi^.
oimonoos silJ- 1 0 Ï eIoana:a iBuaxr sdt
. a c t ' n a i o x ' i l a - o o 9;
. alcont^a
^^
I + 0 = amooiii .'
•:;:•!;
aoxJ-^.
.00
' l o l asniiloBBf, a l d-naflKfaernl
aai' '
'
no'i .
li
a9iiJaxJi)ai
.^rsiïasvni
(^)
a + M = j-.a.,iJt;3YXii XöJ-od"
D8;
J.*^^
^SJJOX XJUJO
Y
0
M
00 3"T:
agltfBi-iöv
:9ldBi'IBV
a
I
,aoxj;:
c '
a _j.£i - I
noi^J-BXTpa, eioiti ©no ©a" oJ SBXI 9TeriT
-!xo"^ «[3il|wi©'l^èeIcfBi«|a.v g etd*
a
-Ï---J?-—-"^
ÏT0lt;R;jD9
n.-:
a.-iiO
^e.
OJ i)3:iXloax :,IB I LriB
('e:
Y » = I ©aoorio
a ' ^ owd" ©lid- gninaraaa n o
0 ©w
oJ- noid-x'Me n± ©cT f)Xx;c"^ --'
0x0 Bi -gnxvBa ©lid- anxdi
,.
O * 30
9o:ji)OT:d-nx Qd" «ïö-lsiq ad' me©a JJO^ •
JO ©fiJ '10
B 90" d^on ÊIuow X) d'flrfd' aai/'-'^^''iL'O B aB X
oBiid' -^jBW airfd' cii Égd-^^Iirrfniol ©o
•i ,JnBo3fl:oo
©rid- asaisxiw X n i gninBsm oi:;ionoo9 YHB ©aa d-on oJb I
Iisvigacfo nascf asxl eisrid' (F.^.&'fi .©m od- i B a l o a i » I c --•- —
xioiriw a a l o ^ o aasnxajjcf l o BSSX'TOVB l a v o n n i y o
d-I .aJjaYlBnB l o l d-nioq gnid-isd-e V 3 B 9 CIB tï sji&m B1
fx. •y!=^'<-rr d-on i)Qan yoJ^Bd'anoo airid- d-BriJ- ,i©v©wo£t,©£r!d" b..
xr 10*3: ©^öfl YJ»ni ©yr ï i TcIIciooqaa «stwd-f/* ©rfd" rri
01) i . t^^
' «©asQ i&ftsl
airid- n i n©va . a
oJEi';i|:.ji:
^00 ©cf'DdX "ïayóianoo od- nosBc .,. ,. ... .-^c, .
&V'i-êÊlÈmit& snid-BiEiid'^e&'rai ï® y,ctx£ic[B'ï±a-9lJ ^ i ,T[ov©wofl ,
i"^'''
rfo
-^^c •
ilÖï^fiw ad-nsmgoIsvajLj
.. o BX
.
— .
^noo© lo ad-naaio-id-eni
^mmn&mjiSSEil
o l é d éattap
bOB -^^ioöga toi
(•i-i')
,tf©rc©onia -^t©^ aitfoY
PROP, m J, fwwmm
«
wm§
J» A»post I'^^i»
8» King QSOV0» Avanos»
Dssy Piufsawt MshslsmoMs»
As I iwots to ye» in «r fw^iows I s t t s r X ii** « h s ^ ^
plsssurs of disoussing with Or MUM» ths proiasms tmO^mA
in yoor drvslopratait m>asXf snd Ï «oula l i k t to pfsssnt a
short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
Variablss
t Y
nstlsiiBl lasons » C 4 Z
(1)
0
sonM^ptisn
li
tniPSStiitsAt in fflsghinss tt»
aonsiMsr goods inOastriss
B
iavsstmsnt in sgjEUIoPBiaBt foot
inTsstwoiEt «BOOS iadastriss
Z
total im—tosnt « K • X
(2)
XcMstioas
t Apeoft frwa tUs t»s slrsatfy wsnttsnsd
thsrs ars tue tsohnioal s<|ueti«os»
émmu
(3)
t . 0^ X
M
Thsrs isas to lis SOS novs «qpstlsn
bstussn nm $ "vwlstolss fw w/tdMk p w
(5)
sboas «I s^Astisa li « 1u X
snd Z «a iwsHnsd to *
^ .^
^^tiooss Z » S(Y
(9*)
Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
:nu
•«•«•«
fv
ril
'fp l l t - « « « « * 4k#iMnr I mA
• i i j « > ^ «ltd
loXvnb
•.^-.
t» me
>?
(O
aKl>lJ-.:ai
A
iR ai«Tit-''cT r"ênff> ''srf f
('^)
£'S
Ji^f-
i;n« «•«
«» I
:iA £«i£l|lll
««5-
ifiV • »
'^
'^H^F ^(Ww
^W^^^WI^P
-
.Ifsdhrift
PROP. DR J . TINBi;RGKN
THE HAGUE, 18 AufjU-St
195^
Sijzenlaan k^
P r o f e s s o r P . O . LiAKALAHOBIS
8, King George Avenue,
New Delhi 2
P.R.S,
_______
Dear Professor I.'ahalanohis,
As I v/rote to you in my previous letter I had the
pleasure of discussing with Dr hl}Maciaethe problans involved
in your development model, and I would like to present a
short coiTiraent using the usual symbols for the economic
variables and your symools for the co-efficients.
Variables
:Y
national income = G + I
(1)
G
consumption
M
Investment in machines for
consimier goods industries
B
investment in equipment for
investment goods industries
I
total investment = M + H
(2)
Equations
: Apart from the tv/o already mentioned
there are two technical equations,
0 = PQ M
(3)
i = Pj_ E
(4)
There has to be one more equation
between the 5 variables.for which you
chose an equation M = \ I
(5)
and I am inclined to
choose I = aY
(5')
I think we can agree on ass-uming the tv/o p's
to be constants; my preference would be in addition to
assume a to be constant, representing the saving ratio
of the country whereas you seem to prefer to introduce
7t as a constant which implies that o: would not be a
constant, iV.'y difficuli:y may be formulated in this way that
I do not &ee any economic meaning in X whereas the
meaning of a is clear to me, a-a ' there has been observed
a constancy in a over averajes of business cycles which
v/ould make it an easy starting point for analysis. It
is true,hov/ever, that this constancy need not prevail
in the future, especially if we may hope for important
capital imports. Even in this latter case, however, I do
not see any reason to consider X
to be constant, I do
see, however, the desirability or investigating alternative
developments which may be conceivable by changing certain
instruments of economic policy. In such a case I prefer
tot specify and define oeforehand what instruments of
economic policy would have to be considered.
Yours very sincerely.
cMxirlsB'
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short ooBiasnt using tiis «coal symDols for His stiWMuiM
variablas and your «sriiibols for ttis oo-sffisicnts*
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sboas «I s^Astisa li « 1u X
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Z think «• son savss sn sstwitng ttas t«» f *s
to M oonstants} ay prsfsrsnos would \m l a addiüsw t s
sssoBS a to IH» oonstant» rsprsssnting ths sariag rat|0
of the country fdisvsss yo» sssa to ppsfs» to liiliiiilliisi
]L as a oonataat #iish Sagpliss that « soOld not M a
^Bstant. My diffisul .y raay hs forrsKaatsd in this «sy ttist
Z do not sss any soonsmio msanlng in )u * « » • « • ths
Bssning of a i s «assr to n s , a s thsri has *ss«i ilMMinrsA
s swistansy in a ovsr awwagss of teisinsss oyalss «feioh
wuld msks i t sn sssy starting point fsr snsilywLS* Zt
Is tros.howsvsr» «*at this oonsisnsy nsst noft papSTOi
in the future, sspstially Itf «« rfiay hops for iinjjortant
capital imports, S¥sn in this l a t t w oas% h w y » 3^^^
not sss aiKir rsason to oonsiasr 1L^ to hs ooHStSBt. Z «•
ses» however» ths dssirahility of investigating altematit»
dsvslopiBsnts shiflh sBsy tos sonssivsbls Ijy shan^bg Sirtsln
instnnsnts of soonendLs polisy. Za ««eli s sass Z p p s j »
tot spsoify snd dsfins osforshand shat instniMnts of
sssnemls polisy sould hsTS to tos saasidisfsd»
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