517. J. E. Meade to Harrod , 22 January 1936 [a]

[Replies to 516 , answered by 530 ]

11 Holywell Street, Oxford #

22 January 1936

Dear Roy,

I just suggest the following method of dealing with . I thought it might perhaps suggest a way to you. Suppose y = total prime cost (instead of average p.c. as in my previous note. [1] ) Then and where x = output. proportionate increase in total cost proportionate increase in output. There are D[ecreasing]. R[eturns]. if , but the condition that should increase as x increases [2] is that the proportionate increase in total cost associated with a given proportionate increase in output should increase as x increases. Is it not possible to say that, after a point at least, this is highly probable?

Yours sincerely,

James Meade.

P. S. I have just been presented with a son and heir, and so took your advice to increase the population within 24 hours of your visit on Monday night! Both Margaret and my son are very well.

  1. 1. Letter 515 , [jump to page] .

    2. The words "Increases as x decreases" substitute "diminish", which was crossed out at a later stage, after Harrod pointed out the mistake on 25 February (letter 530 , [jump to page] ) and sent the letter back to Meade.

    1. a. ALS, two pages on one leaf, in HP IV-745-767/8.

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