Theorie der Volkswirtschaft. Zweiter Teil: Geld und Kapital

Summary

Engländer’s second part turns value theory into an analysis of capital, money, credit, and crisis by emphasizing production through time. Prices and profits are not explained by exchange at a single moment, nor by labor alone, but by the placement of goods and inputs within processes whose results emerge later. Capitalist calculation therefore depends on expectations, turnover periods, and the relation between present advances and future consumer demand.

Wendet sich anderseits die Nachfrage der reicher gewordenen Wirtschaft Kostengüterarten zu, werden zunächst unter Umständen statt der bisherigen anderen Güterarten oder in anderem Verhältnis aus den übergeordneten Güterarten höherer Ordnung erzeugt werden.

English translation: If, on the other hand, the demand of an economy that has grown richer turns toward cost-goods, then, under certain circumstances, other kinds of goods will be produced instead of the previous ones, or the same kinds will be produced in different proportions, from the superordinate higher-order kinds of goods.

This passage shows Engländer’s dynamic method. A shift in demand does not instantaneously reorganize the economy; it moves backward through higher-order goods and disturbs production already underway. Existing equipment, inventories, and labor commitments reflect earlier expectations. Quasi-rents, windfall gains, and losses arise because prices may change before the real structure of production can adapt. They are transitional phenomena of an economy whose capital is specific and time-bound.

As the argument advances from simple exchange to multi-stage production, time becomes the main principle of valuation. Earlier inputs, durable instruments, and advances to labor must be appraised according to their distance from final sale. Interest is thus not merely a monetary addition imposed from outside production. It is bound up with capitalization, waiting, and the immobilization of resources in processes that promise future goods.

Preis der Güterart und damit erst der Zins bestimmt wird. Der Zins wird also in diesem Falle von der Wirksamkeit des Kapitals zwar doch, aber nur mittelbar beeinflußt. Daher kann es in diesem Falle insbesondere auch vorkommen, daß bei größerer Wirksamkeit des Kapitals der Zinsfuß nicht höher, sondern geringer wird.

English translation: The price of the kind of good is determined, and only through it the rate of interest. Interest is therefore in this case indeed affected by the productivity of capital, but only indirectly. Hence in this case it may even happen that with greater productivity of capital the rate of interest is not higher but lower.

The fragment makes clear Engländer’s rejection of a simple productivity theory of interest. Capital’s physical effectiveness matters, but only indirectly, through the prices of the goods produced and through the temporal structure in which production occurs. Interest emerges from market valuation of future-yielding goods, not from a mechanical surplus inherent in capital itself. In the same way, the labor theory is insufficient because it cannot explain the valuation of differently timed and differently committed productive powers.

Money enters this framework as an institution that transfers command over goods and coordinates payments across time. Engländer distinguishes forms of money by quantity, convertibility, minting conditions, and practical circulation.

3. Geld mit Eigenwert Beschränkte Menge 43 — Freie Ausprägbarkeit 46 — Verhalten in der Wirklichkeit 48 — Keine unmittelbare Wirkung des Eigenwertes 48

English translation: 3. Money with intrinsic value. Limited quantity 43 — Free coinability 46 — Behavior in reality 48 — No immediate effect of the intrinsic value 48

These headings indicate the analytical caution of the monetary theory. Commodity value alone does not directly determine money’s economic effect. What matters is how money functions in payments, reserves, and production commitments. Credit extends the same problem: it can economize cash and redirect purchasing power, but it cannot create real capital merely by accounting entries.

Nehmen wir nun noch den Fall eines Barerlages bei einer Bank, und zwar zu bloßen Verwahrungszwecken, so ergibt sich die Möglichkeit, daß die Bank diese bei ihr erlegten Gelder weiterverleiht.

English translation: If we now consider further the case of a cash deposit at a bank, and indeed one made merely for safekeeping purposes, the possibility arises that the bank lends out these funds deposited with it.

The deposit example shows both the power and danger of banking. A bank may lend funds entrusted to it for safekeeping, thereby changing who commands purchasing power and when. If credit mobilizes unused labor and resources, it can support expanded production. If it merely multiplies claims beyond available real capital, it misleads entrepreneurs about the economy’s capacity to complete longer production plans.

Engländer’s crisis theory follows from this temporal capital theory. Crises arise when production has been lengthened, redirected, or financed in ways that later demand and available capital cannot sustain. What first appears as profit, quasi-rent, or easy credit is revealed as maladjustment once goods reach markets and capital proves difficult to transform. Liquidation, unemployment, and falling prices are therefore not accidental interruptions of equilibrium but corrections of an overcommitted productive structure.

The work’s importance lies in its integration of value, capital, interest, money, banking, and crisis around one problem: the coordination of present advances with future consumption. Capitalism is intelligible only as an economy organized in time, and its instabilities arise when monetary and entrepreneurial plans outrun the real limits of production.