Theory of Capital and Cambridge Controversies

Production with produced means of production, that is, capital, is fraught with issues having to do with the capital being reproduced, depreciating, and its price being equal to its cost. We discuss the various efforts of neoclassical economists starting from Jevons, going to Böhm-Bawerk and Samuelson's exploration of a one-commodity world. We find that the measurement of capital goods in a way that is consistent with the requirements of the neoclassical theory of value and distribution reveals formidable problems, as was concluded in the famous capital theory controversies of the 1960s. Furthermore, we discuss some more recent developments connected to these debates