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PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 28

The Case of the Model

Although it facilitates computation, this convention allocates
a particular vole to a specified interval of time, the year, which
is both arbitrary from a theoretical standpoint, and involves
running a risk of suggesting erroneous ideas.
It is for this reason that in the present study, investment
is defined to include any outlay incorporated in a durable good,
whatever its longevity. Under such a definition any output of
primary factors which does not appear immediately as consumed
 income is considered as an investment. It is thus a
simple matter to see the conceptual changes in the notions of
G.N.P., gross investment and amortisation when the framework
 of the present theory is adopted.
If we consider the concept of a continuous characteristic

function 9, depreciation Adt is equal to the primarv income

Redt which emerges in the national consumed income Rod? of
instant # and we have

(116-12)

A=R,

whence

(116-13)

P=R+A
~R+R.

using P to correspond to the equivalent in the present theory
(in which any investment outlay, whatever its durability, is
considered as an investment) of the conventional notion of
G.N.P. (in which a minimum durability of one, or even of
several years is taken as the boundary between operating expenses
 and investment outlays).

[11] Allais - pag. 36