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Reswitching debate is relevant for (a) theories which uses an aggregate production
function for the whole economy, (b) theories which determine income distribution on the
basis of demand and supply of all factors including labour and "capital". So the answer
is yes and no. The answer could be no for those cases which determine income distribution
on the basis of technological aspects, like the AK model: with a technology like this the
rate of profit is A minus the depreciation rate!
I am sorry to give references only to papers I (co-)authored:
Heinz Kurz and Neri Salvadori, "Theory of Production. A Long-Period Analysis". Cambridge:
Cambridge University Press, 1995. Reprinted in 1997, first paperback edition in 1997.
Neri Salvadori, "A linear multisector model of 'endogenous' growth and the problem of
capital", Metroeconomica, 1998.
Heinz Kurz and Neri Salvadori, "'Endogeneous' Growth Models and the 'Classical' Tradition"
by Heinz Kurz and Neri Salvadori, Chapter 4 of Understanding 'Classical' Economics.
Studies in Long-Period Theory, London and New York: Routledge, 1998
With respect to the Bliss book referred to by Roger Backhouse and mentioned by Roy
Weintraub, I agree that it is a good book on capital theory, but with respect to
reswitching it missed the point. The question of reswitching concerns not the
intertemporal equilibrium, but the long period equilibrium. The interested readers can
give a look to an old paper by Garegnani:
"On a Change in the Notion of Equilibrium in Recent Work on Value and Distribution" in M.
Brown, K. Sato and P. Zarembka (eds.) Essays in Modern Capital Theory. Amsterdam: North
Holland, 1976, pp. 25-45.
Maybe the best piece of the relevance of reswitching is
Garegnani, P. (1990a). "Quantity of Capital", in Eatwell, J. L., Milgate, M. and Newman,
P. (eds) Capital Theory, London: Macmillan, 1990, pp. 1-78.
Neri Salvadori
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