The Circulation of Bank Capital and the General Rate of Interest

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Marxian economists have long asserted the impossibility of discovering an economic law at work in capitalist economies that determines a natural rate of interest. Without contradicting Marx’s claim that it is competition in the money capital market that determines the interest rate, it is possible to identify the general rate of interest with greater precision. To make this argument, this article investigates the connection between two interlocking circuits of finance capital.