180 PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 28

CHAPTER II

THE PROCESS OF PRODUCTION IN THE SHORT RUN

.. A very simple case: production by means of labour alone

We may begin our analysis by considering the process of
production at a given point of time or, to be more realistic,
within a short period of time, defined in such a way that,
within it, changes in population, productive capacity, technical
knowledge and consumers’ preferences are negligible.
The economic system we are considering is closed and consists
 of a society of individuals whose purpose 1s to produce
goods in order to derive enjoyment (or relief from pain) by
consuming them. Two types of activities are therefore performed
 in the system: a production activity and a consumption
activity. At the beginning of the period, the production processes
 are programmed in the best way that is technically
known and, at the end of the production processes, the commodities
 are consumed. Technical knowledge is supposed to
be quite advanced so that each process of production requires
division of labour and a marked specialisation. Therefore, each
individual consumes only a very small part of the commodities
he produces (or contributes to produce); and obtains all the
others through exchange. Total production (and therefore consumption)
 is well diversified: the system produces many types
of commodities, according to the preferences of its individual
members, or consumers.

10] Pasinetti - pag. 10