The circular flow of income or circular flow is a model of the economy in which the major exchanges are represented as flows of money, goods and services, etc. between economic agents. The flows of money and goods exchanged in a closed circuit correspond in value, but run in the opposite direction. The circular flow analysis is the basis of national accounts and hence of macroeconomics.
The idea of the circular flow was already present in the work of Richard Cantillon.[3] François Quesnay developed and visualized this concept in the so-called Tableau économique.[4] Important developments of Quesnay's tableau were Karl Marx's reproduction schemes in the second volume of Capital: Critique of Political Economy, and John Maynard Keynes' General Theory of Employment, Interest and Money. Richard Stone further developed the concept for the United Nations (UN) and the Organisation for Economic Co-operation and Development to the system, which is now used internationally.
^Gwartney, James D.; Stroup, Richard L.; Sobel, Russell S.; Macpherson, David A. (2014). Macroeconomics: Private and Public Choice. Cengage Learning. pp. 173–175. ISBN 978-1-285-45354-5.
^Daraban, Bogdan (2010-06-05). "Introducing the Circular Flow Diagram to Business Students". Journal of Education for Business. 85 (5): 274–279. doi:10.1080/08832320903449527. ISSN 0883-2323. S2CID 154585027.
^Antoin E. Murphy. "John Law and Richard Cantillon on the circular flow of income." Journal of the History of Economic Thought. 1.1 (1993): 47–62.
^Backhouse, Roger E., and Yann Giraud. "Circular flow diagrams." in: Famous Figures and Diagrams in Economics (2010): 221–230. Chapter 23.
and 23 Related for: Circular flow of income information
The circularflowofincome or circularflow is a model of the economy in which the major exchanges are represented as flowsof money, goods and services...
networks Circularflowofincome Control flow diagram, a diagram to describe the control flowof a business process, process or program Cumulative flow diagram...
a tax on tax, as with a gross receipts tax. In economic terms (circularflowofincome), taxation transfers wealth from households or businesses to the...
capita) (PPP per capita) Chained volume series Circularflowofincome Disposable household and per capita income Economy monetization GDP density Gross regional...
bank – Ceteris paribus – Charity shop – Chicago School of Economics – Circularflowofincome — Classical economics – Classical general equilibrium model...
Finance § The financial system Financial services Financial market Circularflowofincome O'Sullivan, Arthur; Sheffrin, Steven M. (2003). Economics: Principles...
A method of modelling the decision process of an individual or segment via revealed or stated preferences. circularflowofincome A model of the economy...
cash flows back to the private sector are modeled to illustrate the circularflowofincome. The comparative analysis of the tax-induced loss of utility...
owners of the means of production that the firm utilises (see Circularflowofincome). PED and PES can also have an effect on the deadweight loss associated...
from the circularflowofincome. But not all expenditures are planned. For example, if an automobile plant produces 1,000 cars, but not all of them are...
sector, resulting in increased output and economic expansion" (see Circularflowofincome). The idea here is that individuals and governments save money...
environment. In this case, the circularflowofincome diagram may be replaced by a more complex flow diagram reflecting the input of solar energy, which sustains...
Physiocrats, a group of 18th-century French thinkers and writers, developed the idea of the economy as a circularflowofincome and output. Physiocrats...
the labour force would benefit the economy of the state or country by increasing the circularflowofincome; it is estimated that every £10 spent on local...
expenditure. The size of the multiplier should take account of all leakages from the circularflowofincome and expenditure occurring in all sectors. The complex...
the notion of a circularflowofincome throughout an economy. François Quesnay (1694–1774) served as the court physician to King Louis XV of France. He...
endorsement ofcircularflow models and suggests they are necessary for current economic analysis. Some economists claim that Krugman's casual treatment of concepts...
subsystem of the environment. In this model, the circularflowofincome diagram is replaced in ecological economics by a more complex flow diagram reflecting...
instrumentalism of shallow ecology and the environmental economists commodification of everything external to the market system. A simple circularflowofincome diagram...
reciprocal exchange of goods or services without the use of money Chartalism – Heterodox theory of money Circularflowofincome – Model of the real economy...
Circular migration or repeat migration is the temporary and usually repetitive movement of a migrant worker between home and host areas, typically for...
the basic principles of double taxation treaty. The only tax circular specifically addressing the PRC income tax treatment ofincome derived by QFIIs from...
circular flowofincome has been developed, which comprehends similar concepts. In his 1913 Principles of economics Seager further extended his theory of production...