Wednesday, October 15, 2014

Magic Number?

Another universal constant? Seth Ackerman in his Jacobin review of Piketty calls r ‘raw’ rate of return and says that it has been steady for centuries. Browsing through ‘A nation deep in debt: the financial roots of democracy’ by James Macdonald I find on page 93 ‘Then in 1482, Venice attempted to revive the old idea on a clean state,… Interest rate was again set at the magic rate of 5%…”. Can somebody comment on this 5%?
P.S. Another recent study of Venice which strangely does not refer to James Macdonald

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