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- Title
Budget Constraints and Business Enterprise: A Veblenian Analysis.
- Abstract
The article uses Thorstein Veblen's theories to critique the neoclassical treatment of budget constraints. The neoclassical consumer has a budget constraint, which limits spending power, while the producer has no similar constraint. The paper argues that a financing constraint is necessary to explain the growth of a firm's productive capacity. The constraint is composed of internal and external financing sources, linked by the value of collateral. The neoclassical treatment of constraint is a remnant of classical liberal views of property rights.
- Subjects
VEBLEN, Thorstein, 1857-1929; NEOCLASSICAL school of economics; PROPERTY rights; BUDGET; FINANCIAL management; HOUSEHOLD budgets; OPERATING budgets
- Publication
Journal of Economic Issues (Association for Evolutionary Economics), 2006, Vol 40, Issue 4, p1029
- ISSN
0021-3624
- Publication type
Article
- DOI
10.1080/00213624.2006.11506973