Reading Notes for The Theory of Interest for Irving Fisher

Powerful Essays
1
Reading notes from Irving Fisher’s The Theory of Interest, 1930
Preface -- It was the misunderstanding of my theory of interest put forward in my 1907 book the Rate of Interest that led me to adopt the catchword “investment opportunity” as a substitute for the inadequate term “productivity” which had come into general use.
This combined with my early “impatience theory” led to the impatience and opportunity theory which can be said to be distinct from all other theories of interest because it explicitly analyzes opportunity and fits together impatience and opportunity and income.
The income concept plays the basic role in the theory of interest. I venture to hope that the theory here presented, will be found not so much to overthrow as to coordinate previous theories, and to help in making the chain of explanation complete and strong.
The term “investment opportunity” seems to be the nearest expression in popular language to suggest the technical magnitude r employed in this book. The full expression for r is the rate of return over costs, and both cost and returns are differences between two optional income streams. So far as I know, no other writer on interest has made use of income streams and their differences, or rates of return over cost per annum.
Part I Introduction Chapter 1 income and capital Paragraph 1 subjective or enjoyment income. It is only what we carry out of the marketplace into our homes and private lives which really counts. Money is of no use to us until it is spent. The ultimate wages are not paid in terms of money but in the enjoyment it buys. Enjoyment income is a psychological entity; we can approximate it indirectly by going one step back a bit to what is called real income. Real wages and indeed real income in general consist of those final physical events in the outer world which give us our inner enjoyment.
Just as we went back of an individual's enjoyment income to his real income, we now go back to his real

You May Also Find These Documents Helpful

  • Good Essays

    Irving Fisher

    • 414 Words
    • 2 Pages

    BIOGRAPHY 20.1 Irving Fisher (1867 -1947) Irving Fisher was born at Saugerties, New York, the son of a Congregational minister. As did his father, Fisher studied at Yale. Mathematics was his favorite subject. He won first prize in a math contest even as a freshman; his doctoral dissertation,Mathematical Investigations in the Theory of Value and Prices (1892), was a landmark in the development of mathematical economics. This dissertation won immediate praise from no lesser figures than Francis Y…

    • 414 Words
    • 2 Pages
    Good Essays
  • Good Essays

    the theories we know today. One of these individuals who influenced economics in this way was Irving Fisher. Irving Fisher was a very unique and brilliant man. He attended Yale University where he studied mathematics. He later used this background and applied it to economics, earning a PhD in economics, the first from Yale University. His study of mathematics played a crucial role in how his theories evolved. Almost all of his work involves mathematical computations to express the theories he devised…

    • 1007 Words
    • 5 Pages
    Good Essays
  • Good Essays

    Irving Fisher Essay

    • 11441 Words
    • 46 Pages

    Irving Fisher - His Life Fisher was born in New York state in 1867. He studied science and philosophy at Yale. Here he had a wide variety of interests. For example, he published poetry and works on astronomy, mechanics, and geometry. Despite all of these interests, Fisher was most interested in mathematics and economics. Yale did not have an Economics Department at the time. Regardless, Fisher continued with his interests and earned the first Ph.D. in economics ever awarded by Yale. Fisher stayed…

    • 11441 Words
    • 46 Pages
    Good Essays
  • Satisfactory Essays

    DEVELOPMENT READING INTEREST RELATION READING 1 The development of reading interest and its relation to reading ability Alexis Jones Mississippi Valley State University DEVELOPMENT READING INTEREST RELATION READING 2 The development of reading interest and its relation to reading ability The five authors of this article came up with a good question that many educators have wondered; does the interest of reading have anything…

    • 517 Words
    • 3 Pages
    Satisfactory Essays
  • Powerful Essays

    Theories of Reading

    • 4177 Words
    • 11 Pages

    Theories of Reading http://parlindunganpardede.wordpress.com/articles/language-teaching/a-review-on-reading-theories-and-its-implication-to-the-teaching-of-reading/ So far, there are three main theories which explain the nature of learning to read. First, the traditional theory, or bottom up processing, which focused on the printed form of a text. (2) the cognitive view, or top-down processing enhanced the role of background knowledge in addition to what appeared on the printed page. Third, the…

    • 4177 Words
    • 11 Pages
    Powerful Essays
  • Good Essays

    Reading Theories

    • 910 Words
    • 4 Pages

    Reading theories Of the two approaches mentioned in reading research and literature, the bottom-up approach focuses on language elements such as grammar, vocabulary and cohesion, while the top-down approach includes a focus on background knowledge about content and organization, generally referred to as content and formal schemata respectively. A combination of these two approaches is generally known as the Interactive Model of Reading. The pedagogy in this study was based on the Schema Interactive…

    • 910 Words
    • 4 Pages
    Good Essays
  • Satisfactory Essays

    Fisher

    • 1668 Words
    • 33 Pages

    Creating the Right Supply Chains for Your Product Marshall Fisher UPS Professor © 2007 Marshall L. Fisher Products differ Product variety Low High Forecast accuracy High Low Product life cycle Long Short Risk of obsolescence Low High Cost of lost sale Low High Functional © 2007 Marshall L. Fisher Innovative And supply strategies differ Factory focus Inventory Strategy Lead-time focus Supplier selection Product-design strategy…

    • 1668 Words
    • 33 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Analysis of Reading Interest Inventory I gave Mariah Sheard a reading interest inventory with thirteen questions. Mariah said she likes reading, but has a hard time finding time to do it. When she did find time to sit down and read she would ready about two hours a week. She stated that her favorite types of books were non-fiction and drama. She said that she likes both series and non-series books but a lot of the time she does not get to finish the entire series. At the time of the survey she was…

    • 457 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    My interest in reading intervention began early in my career when I was trained as a Reading Recovery teacher for FWISD. This program planted the seed that grew into a keen understanding that students were reading as well as they knew how to, that they would not become more proficient readers accidently, but rather through intentional, systematic teaching. Thus my dedication for teaching students to read, how to read better, and how to better understand what they have read to become more confident…

    • 375 Words
    • 2 Pages
    Good Essays
  • Good Essays

    Fisher Effect

    • 741 Words
    • 3 Pages

    INTRODUCTION In order to dig into the Fisher effect it is important to understand it origins and its logic first. The Fisher effect is a theory proposed by Irving Fisher. He was an economist who essentially described association or linkage between inflation as well as nominal and real interest rates. (Investopedia.com, 2014) Mr. Fisher in his theory stated “that the real interest rate equals the nominal interest rate minus the expected inflation rate. Therefore, real interest rates fall as inflation increases…

    • 741 Words
    • 3 Pages
    Good Essays