Both real flows and money flows are part of the circular flow of income model, each being two sides of the model. While real flows focus on goods and services, money flows focus on payments for ...

In the study of economics, one learns the circular flow of the economy between firms and households. This post, however, presents another circular flow model based on capital and labor. (It is a ...

The circular flow of income model illustrates how money moves through an economy between households and firms. In this model, injections are external sources of income that enter the flow ...

But the economy is just too complex to grasp without some sort of simple, realistic model. Attempts to build such models have floundered. Hayek’s Triangles, Böhm-Bawerk’s Concentric Circles, and the ...

The circular-flow approach is decidedly Neoclassical, and suffers from many problems which traditional Austrians would notice. The circular-flow diagram’s greatest problem is, in fact, its circularity ...