Paul Narcyz Rosenstein-Rodan’s 1934 journal article distinguishes three problems commonly obscured by general appeals to time: the horizon of economic planning, the allocation of scarce time, and the velocities of adjustment. Moving from the structure of wants to equilibrium analysis, it argues that temporal conditions help determine what agents can plan, what satisfaction costs, and whether economic adjustment reaches equilibrium.
THE rôle of time in economic theory is a subject which in recent years it has become more and more fashionable to discuss.
Against this general interest, Rosenstein-Rodan seeks precise analytical distinctions. The first section challenges the claim that given tastes and resources suffice to determine conduct: their allocation also depends on the period for which provision is made. This period belongs to the temporal structure of wants rather than standing outside preferences as an unrelated datum. Treating economic quantities as flows does not establish that individuals necessarily plan over an infinite horizon.
We have therefore certainly no right to assume that "provision for eternity" is inherent in the conception of a system of wants itself, any more than the superiority of pears over apples.
Indefinite capital maintenance is therefore a particular disposition requiring explanation, not a universal implication of rational choice. Rosenstein-Rodan connects planning horizons with individuals’ capacity to anticipate their needs.
Now it may be said that the length of the economic period depends on the "horizon of the imagination and will" of the individual.
The decisive issue is imperfect foresight, not simply an inherent undervaluation of future satisfaction. As the future becomes more remote, concrete wants become harder to anticipate; provision increasingly takes the form of reserves for unspecified needs and security. The boundary of concretely anticipated wants defines the economic consumption period without exhausting the horizon of saving. Differences in motives, divisibility, and responsiveness give saving and current consumption a partial independence that introduces psychological frictions into choice. Equilibrium within a planning period must consequently be distinguished from equilibrium through time, as new sub-periods enter the horizon and old ones disappear.
The second section establishes the scarcity of time through an imagined paradise where material goods are unlimited but life and the day remain finite. Consumption still requires choice because satisfying one want excludes other uses of time. Yet time does not everywhere have the same economic status: consumption time enters the valuation of goods as an associated cost, whereas leisure is itself an object of choice. Rosenstein-Rodan also distinguishes general aversion to effort from the particular irksomeness of different kinds of labour. Equal working hours need not entail equal sacrifices. His proposed indifference framework incorporates goods, their consumption time, and productive disutilities while representing leisure separately, extending ordinal analysis without requiring measurable utilities.
The third and longest section asks what equilibrium theory can explain about actual economic movement. Equilibrium conditions identify tendencies, but do not by themselves specify when reactions begin, how long they last, or at what speed they proceed. Demand, prices, and supply can respond at different rates, producing convergent, persistent, or expanding oscillations.
The image of a dog pursuing a moving hare clarifies the distinction between a direction of adjustment and the path actually followed. Reconstructing that path requires adjustment velocities, which must themselves be explained through economic determinants. A relation specifying how demand depends on price does not automatically explain how excess demand changes price. Restoring time thus separates dependencies that static analysis can treat as reversible.
New disturbances may also arrive before previous adjustments are complete. Their overlapping effects can change both the direction of movement and the eventual outcome, rather than merely delaying arrival at an unchanged equilibrium. Rosenstein-Rodan distinguishes these cumulative effects from latent effects activated by a later disturbance, while leaving their fuller analysis open.
The conclusion considers multiple equilibria involving prices, quantities, and uses. Expectations complicate their determination, but actual frictions may favour one otherwise possible outcome. The article’s unifying claim is that uncertainty, scarce time, adjustment lags, and inertia are constitutive features of economic processes. They affect not only the route towards equilibrium but also the selection and character of the outcome.
This work was divided into 4 sections when it entered the library's research corpus—an apparatus for search and citation, not necessarily the author's own table of contents. Each title opens its summary.
Put a question to this work; the Librarian answers from its 4 sections and cites the passage.
Ask the Librarian