Abstract

MIR ARTIGUES, Pere  and  GONZALEZ CALVET, Josep. The Funds and Flows Model and the Scale of Productive Processes. Inv. Econ [online]. 2007, vol.66, n.259, pp.133-165. ISSN 0185-1667.

This article deals with different questions concerning production economics using, as a basic reference, the fund-flow model of Nicholas Georgescu-Roegen. The first step is to explain the basic concepts around which the model is built, i.e., the notion of funds and flows and, in particular, that of the elementary process. With these tools, it is possible to develop a highly detailed representation of productive operations that is open to partial modification when applied. Secondly, the funds and flows approach permits to redefine and highlight new aspects of the process in line. In turn, this analysis also implies a reinterpretation of the well-known concepts of scale and indivisibility. Finally, the article deals with the topic of costs. As it is known, economists are currently concerned with the way in which costs react to changes in the level of production. Here, however, the analysis is somewhat different: it is a question of ascertaining the behaviour of costs over time, and particularly of analysing their behaviour in the light of the deployment of productive activity. There is no doubt that the model proposed by Georgescu-Roegen makes it possible to shed new light on certain long-established concepts of microeconomic production theory.

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