Reply To: Money Costs, Prices, and Alfred Marshall


I think Rothbard was stipulating, as I also did in my previous post, that the value of the output was staying the same in the adjustment process.

In general, however, such a stipulation does not hold (which is what I implicitly assumed in my first post) and both output and input prices would adjust. In your example, then, the price of the mall would fall below $10 million when the economy reached the ERE and the reproduction costs would rise above $8 million.